Tuesday, January 15, 2013

Smoking ban’s full economic effects debated

By Nick Tabor, New Era Senior Staff Writer
Given how much Kentucky’s budget depends on tobacco taxes, would a statewide smoking ban deal it a staggering blow?
A new poll shows public support for a smoking ban is inching up every year. Though the ban likely won’t get a vote during this year’s General Assembly, state politicians, including those who represent this district, are confronting those economic questions more directly.
Between settlement payments and taxes, Kentucky collects an average of $321 million a year in tobacco revenue, according to a report from the Campaign for Tobacco-Free Kids. Sen. Whitney Westerfield, R-Hopkinsville, and Rep. Myron Dossett, D-Pembroke, both said they’d vote down a statewide ban for this reason.

“The state is dependent on that revenue,” Dossett said. “Smoking is bad for your health. I understand that right there. But knowing what tobacco puts into the economy, it’s another one of those issues that concerns me.”
But Foundation for a Healthy Kentucky points that the state exports most of its tobacco — 85 percent — according to HR 149, a new bill related to tobacco trade. So even if the state cut its smoking rate in half, this wouldn’t decimate the tobacco revenue.
And the Kentucky Chamber of Commerce says a lower smoking rate would save the state on health care costs.
From 2000 to 2012, Medicaid spending grew about three times faster than the overall state budget, the chamber reported. And Kentucky has some of the worst cancer statistics. For instance, there are 9,500 cancer-related deaths a year.
“Increasingly, Medicaid dollars are being used to treat cancer,” a chamber report states.
In 2000, a 72-year-old diagnosed with cancer would typically spend $2,687 to $9,360 in the first six months of treatment, according to a study published in Value in Health.
Foundation for a Healthy Kentucky didn’t have data on cancer-related spending, but the state is spending a rough total of $7.7 billion on health care in this fiscal year, according to a source it supplied. Rep. John Tilley, D-Hopkinsville, believes cancer-related spending is hundreds of millions or more every year.
On the revenue end, Kentucky gets 60 cents in taxes for every pack of 20 cigarettes, and the Blue Ribbon Commission on Tax Reform recommends raising that to $1. The state also has a 15 percent tax on chewing tobacco and most other forms.
Then there are non-economic factors.
Westerfield and Dossett oppose smoking bans on principle.
“I have a problem with the government telling a private business what it can and cannot allow in there on something like that,” Westerfield said.
Dossett also imagines a problem with enforcement. Some proposals for a state ban even cover apartment buildings, and it’s possible they could cover farmers’ barns, he said.
Tilley’s decision to support or oppose a statewide ban would depend on specifics. Now that so many cities have enacted their own bans, a state law might conflict with their ordinances.
“You could create complexity unnecessarily,” Tilley said. “It sounds much more simple than it is.”
The American Nonsmokers’ Rights Foundation lists 30 Kentucky cities and counties that have smoking bans, but it does not include Hopkinsville’s new ban.
Kentucky is only one of only 14 remaining states that doesn’t ban smoking in restaurants, bars or non-hospitality workplaces, the group reports.
Regardless, Westerfield and Dossett don’t expect a vote on the subject this year.
“We have very big fish to fry in front of it,” Westerfield said. “Pension reform. Maybe tax reform. It just depends on how much work we can get on those two fronts.”

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