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Tobacco Windfall to go to General Fund

By Sable Harris
Alabama Political Reporter

Tuesday March 12, 2013, the twelfth legislative day in Montgomery

The package deal was passed in the Senate, SB287 and SB288 passed on the Senate floor. SB287 provides for transfer to the state general fund during the fiscal year 2014 of certain anticipated tobacco revenue, while SB288, under existing law, says Children First Trust Fund programs are required to be funded through a separate appropriation in a separate act.

The Children First Trust Fund established in the mid 90s by a group of legislators and activist was created to improve the lives of Alabama’s children. In whole the tobacco companies increased cigarette taxes giving its revenue to individual states.

Alabama’s portion went to fund needed programs and services. After a few years a settlement was reached and by the year 2000 the settlement income started to fluctuate. The master settlement gave Alabama an approximate 1.6% of its overall national settlement. The children trust funds administer funds to other agencies that help those needs of children.

In December of 2012, it was discovered that up to $48 million can be a windfall for the state after a 2006 lawsuit. This is a $48 million income in addition to the 1.6 percent revenue the state is getting. However the question is what to do with this extra money? This is where Senate bill 228 comes into play.

Children First’s Executive Director, Christy Mehaffey says that Children First Trust Fund is set up by statute to fund children’s services. She says these funds over the last six years have been withheld from the agencies and now that the arbitration is expected to be concluded any funds released by law should go to children.

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According to Senator Williams this bill will keep the state at a more level funding in those agencies such as the Department of Corrections and Medicaid.

“Correction and Medicaid are the two big 800 pound Gorillas in the room that consumes a large amount of our budget. This bill will give the ability to work within the budget to not have Medicaid and corrections ciphering off other departments,” says Senator Williams.

Senator Waggoner agrees with Senator Williams, he is pleased with the way that this funding is spent and sees it as noting but a boost for the general budget.

“My real interest is that it puts in a million dollars into the cancer research at the University of Alabama Birmingham, and to the Alpha Hudson which are very close to my district so it helps my district.“

On the opposing side, democratic Senator Figures see this bill as taking away from the Children First Trust Fund.

“It takes money away from the Children’s First Trust Fund and even the money that they said was designated for the Children’s First Trust Fund. It’s their money, I am tired of them kicking the can down the road, robbing from Peter to pay Paul,” says Senator Figures.

Senator Coleman shares this rage stating, “So once again the majority parties puts the prisoners before the children, time to make a change.”

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Now that the bill has passed in the Senate it will be sent down to the House.

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