HomeMy WebLinkAboutMINUTES - 05152012 - SD.5RECOMMENDATION(S):
SUPPORT Proposition 29, Tobacco Tax for Cancer Research Act (June 2012), an initiative that imposes an
additional five cent tax on each cigarette distributed ($1.00 per pack), and an equivalent tax increase on other tobacco
products, to fund cancer research and other specified purposes, as recommended by Supervisors Gioia and Mitchoff.
FISCAL IMPACT:
Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government:
Increase in new cigarette tax revenues of about $855 million annually by 2011- 12, declining slightly annually
thereafter, for various health research and tobacco-related programs. Increase of about $45 million annually to
existing health, natural resources, and research programs funded by existing tobacco taxes. Increase in state and local
sales taxes of about $32 million annually.
APPROVE OTHER
RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
Action of Board On: 05/15/2012 APPROVED AS RECOMMENDED OTHER
Clerks Notes:
VOTE OF SUPERVISORS
AYE:John Gioia, District I
Supervisor
Mary N. Piepho, District III
Supervisor
Karen Mitchoff, District IV
Supervisor
Federal D. Glover, District V
Supervisor
ABSENT:Gayle B. Uilkema, District II
Supervisor
Contact: L. DeLaney, 925-335-1097
I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the
Board of Supervisors on the date shown.
ATTESTED: May 15, 2012
David Twa, County Administrator and Clerk of the Board of Supervisors
By: Stacey M. Boyd, Deputy
cc:
SD. 5
To:Board of Supervisors
From:Supervisors Gioia and Mitchoff
Date:May 15, 2012
Contra
Costa
County
Subject:Support for Proposition 29--Tobacco Tax for Cancer Research Act (June 2012)
BACKGROUND:
California Proposition 29, the Tobacco Tax for Cancer Research Act is on the June 5, 2012 presidential primary
ballot in California as an initiated state statute. If Proposition 29 is approved by California's voters, the tax on
cigarettes in the state will increase by $1.00 per pack. California’s current cigarette tax is 87 cents per pack. The
total tax per pack of cigarettes, if Proposition 29 passes, will be $1.87/pack. The additional tax revenue will be
used to fund cancer research, smoking reduction programs, and tobacco law enforcement.
Proposition 29 would generate about $735 million a year in new tax revenues, according to a 2012 report by the
California Legislative Analyst's Office. In 2011 the Legislative Analyst's Office had projected the revenue to be at
$850 million a year but later updated that analysis.
The last time a cigarette tax was on the California ballot was in 2006, when Proposition 86 was narrowly
defeated. Proposition 86 would have imposed an additional tax of $2.60 per pack of cigarettes.
The ballot title is: Imposes Additional Tax on Cigarettes for Cancer Research. Initiative Statute.
Official summary: The official summary provided by the Attorney General of California's office to describe the
initiative says:
"Imposes additional five cent tax on each cigarette distributed ($1.00 per pack), and an equivalent tax increase on
other tobacco products, to fund cancer research and other specified purposes. Requires tax revenues be deposited
into a special fund to finance research and research facilities focused on detecting, preventing, treating, and curing
cancer, heart disease, emphysema, and other tobacco-related diseases, and to finance prevention programs.
Creates nine-member committee charged with administering the fund."
The proposed initiative would:
Levy an excise tax on every distributor of cigarettes at the rate of fifty mills for each cigarette sold.
Levy a floor stock tax on every cigarette dealer or wholesaler for each cigarette in his or her possession at
the rate of fifty mills for each cigarette.
Use of revenue
Revenue raised by the initiative would be spent as follows, according to the California Legislative Analyst's
Office:
Approximately $75 million annually would maintain existing tobacco tax revenue streams. The objective
here is avoid negatively impacting other revenue streams from other cigarette taxes such as from
Proposition 99 (1988) and Proposition 10 (1998).
60% (approximately $468 million annually) would to go research of cancer and tobacco-related disease "for
the purpose of grants and loans to support research into the prevention, early detection, treatments,
complementary treatments and potential cures of lung cancer and other types of cancer, cardiovascular
disease, emphysema and other tobacco related diseases, including but not limited to coronary heart disease,
and chronic obstructive lung disease".
15% (approximately $117 million annually) would go to facilities and capital equipment for research "for
the purposes of grants and loans to provide facilities, including but not limited to those building, building
leases and capital equipment as my be found necessary and appropriate by the Committee, to further
biomedical ,epidemiological, behavioral, health services, and other research whose primary focus is to
identify and refine promising prevention, early detection, treatments, complementary treatments,
rehabilitation and potential cures of lung cancer an other types of cancer, cardiovascular disease,
emphysema and other tobacco related diseases".
20% (approximately $156 million annually) would go to tobacco prevention and cessation to the state’s
existing tobacco control program. These funds would be divided between the California Department of
Public Health (80%) and the California Department of Education (20%) for their existing programs to
prevent and reduce the use of tobacco.
3% (approximately $ 23 million annually) would go to tobacco law enforcement "to support law
enforcement efforts to reduce cigarette smuggling, tobacco tax evasion, and counterfeit tobacco products, to
reduce illegal sales of tobacco products to minors, and to enforce legal settlement provisions and conduct
law enforcement training and technical assistance activities for tobacco related statues".
No more than 2% (approximately $16 million annually) would go to administration, including the
collection, auditing, and distribution of revenue.
Governing committee
The initiative would create a 9-member governing committee charged with administering the fund. The California
Cancer Research Act Oversight Committee would be composed of:
3 University of California chancellors (Berkeley, San Francisco and Santa Cruz)
3 "selected from among Cancer Center Directors of National Cancer Institute designated cancer centers
located within the State of California" (appointed by the Governor of California)
1 "affiliated with a California Academic Medical Center who is a practicing physician with expertise in the
prevention, treatment or research of cardiovascular disease" (appointed by the Governor of California)
2 "selected from among California representatives of California or national disease advocacy groups whose
focus is tobacco-related illness, at least one of whom shall be a person who has been treated for a tobacco
related illness." (appointed by Director of California Department of Public Health)
A Committee to establish a peer review process for selection of grants modeled on the process used by the
National Institutes of Health.
CLERK'S ADDENDUM
Speakers: Margo Connolly, Volunteer Legislative Ambassador for the American Cancer Society (handout
attached); Laura Nathan, American Cancer Society; Ralph Hoffman, resident of Walnut Creek .
ATTACHMENTS
Proposition 29
California Budget Project Analysis of Prop. 29