Fight for tobacco payout looms

Owens' plan would settle for $800 million, use 10% to fix budget

By Mike McPhee
Denver Post Staff Writer

The battle line was drawn Thursday over Gov. Bill Owens' proposal to balance next year's budget with tobacco money.

Owens, believing it risky to rely on future payments, wants to settle for an $800 million payoff, using $80 million to fix the budget and the rest for a "rainy day" fund.

But Thursday, Colorado Sen. Dave Owen, R-Greeley, the vice-chair of the Joint Budget Committee, said he doesn't think the governor's payoff proposal has enough support in the legislature to pass.

Colorado receives, on average, about $100 million a year from tobacco payments, which should last roughly another 21 years. The payments stem from the settlement of class-action lawsuits filed by states against tobacco companies over smoking-related health problems.

Thursday, anti-smoking and health advocates including the grandson of the founder of the R.J. Reynolds Tobacco Co. appealed to legislators to scrap Gov. Owens' plan for a lump-sum payoff.


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Members of the Colorado Tobacco Education and Prevention Alliance argued that Gov. Owens' plan will eliminate funding to a smoking-cessation plan run by the state health department.

"These (smoking-cessation) programs have had spectacular results," said Patrick Reynolds, who chose to work full time against smoking after watching his father die of lung disease.

Sen. Owen said that if the governor's plan passes, he doesn't believe programs funded by the tobacco money would die.

"They won't go away. They'll find a way to be funded out of the $800 million, which will be spent faster than anyone thinks," he said.

The cessation program this year received only $3.8 million, about half of what was paid out in fiscal year 2001-02.

Gov. Owens on Tuesday told the budget committee that all programs funded by tobacco money, including smoking-cessation programs, would be phased out within three years.

But Thursday, Owens changed his tune and said the smoking-cessation program would receive $13.5 million next year. However, no decision about its funding has been made beyond next year, he said.

In addition to using $80 million of the payout to help balance next year's budget, Owens has proposed putting the remaining $720 million into a "rainy day" fund for emergencies. Members of the JBC said they doubted that fund would last more than a few years before being spent.