HS HCS HJR 61 -- TOBACCO SETTLEMENT (Van Zandt)

This proposed amendment to the Missouri Constitution establishes
the Tobacco Settlement Trust Fund for receipt of any legal
settlement or award relating to tobacco-related products and
prohibits funds received from the settlement and any proceeds
from investment of the funds from being classified as total
state revenues and excludes the expenditure of the funds from
being an expense of state government.

All moneys in the trust fund and accrued interest must remain in
the trust fund until the corpus of the trust fund reaches $175
million.  Once the corpus of the trust fund reaches $175
million, that amount will be transferred to the Tobacco
Settlement Endowment.  This original transfer will remain in the
endowment until the corpus of the endowment reaches $1 billion.
All moneys in excess of $1 billion in the endowment will be
transferred back to the trust fund.

After the initial transfer of $175 million into the endowment
and when the corpus of the trust fund again reaches $175 million
from future receipts, that amount will be transferred to the
Pharmacy or Health Care Relief Fund for the Elderly.  Moneys in
this fund will be subject to annual appropriations of the
General Assembly.

All moneys transferred from the endowment to the trust fund and
all moneys received in the trust fund after the initial
transfers of $350 million from the trust fund will be subject to
appropriation and used and expended solely for programs as
follows:

(1)  50% for health care access and treatment;

(2)  20% for health sciences research;

(3)  15% for comprehensive tobacco cessation, education, and
prevention; and

(4)  15% for early intervention and prevention programs for
children.

These percentage restrictions will expire after June 30, 2012.

Moneys in the endowment will not be subject to state law
regarding the investment of surplus state funds.

FISCAL NOTE:  Estimated Net Foregone Income to General Revenue
Fund of $135,464,421 in FY 2001, $162,447,798 in FY 2002, and
$164,044,888 in FY 2003.  Net Effect on Tobacco Settlement Trust
Fund of an income of $135,420,621 in FY 2001, a cost of
$12,552,202 in FY 2002, and a cost of $10,955,112 in FY 2003.
Net Income to Tobacco Settlement Endowment of $0 in FY 2001,
$175,000,000 in FY 2002, and $0 in FY 2003.  Net Income to
Pharmacy or Health Care Relief Fund for the Elderly of $0 in FY
2001, $0 in FY 2002, and $175,000,000 in FY 2003.

HCS HJR 61 -- MISSOURI TOBACCO SETTLEMENT

SPONSOR:  Van Zandt

COMMITTEE ACTION:  Voted "do pass" by the Committee on Missouri
Tobacco Settlement Committee by a vote of 12 to 2.

This proposed amendment to the Missouri Constitution establishes
a trust fund for receipt of any legal settlement or award
relating to tobacco-related products and prohibits funds
received from the settlement from being classified as total
state revenues.

All moneys in the trust fund and accrued interest must remain in
the trust fund until the corpus of the trust fund reaches $300
million.  Once the corpus of the trust fund reaches $300 million
that amount will be transferred to an endowment.  This original
transfer will remain in the endowment until the corpus of the
endowment reaches $1 billion.  All moneys in excess of $1
billion in the endowment will be transferred back to the trust
fund.

All moneys transferred from the endowment to the trust fund and
all moneys received in the trust fund after the initial transfer
of $300 million from the trust fund will be subject to
appropriation solely for programs related to preventative health
care, health care for children and families, health research,
and smoking prevention and cessation.

Moneys in the endowment will not be subject to state law
regarding the investment of surplus state funds.

FISCAL NOTE:  Estimated Net Loss to General Revenue Fund of
$143,243,800 in FY 2001, $172,000,000 in FY 2002, and
$173,500,000 in FY 2003.  Net Effect on Tobacco Settlement Trust
Fund of an income of $143,200,000 in FY 2001, a cost of
$128,000,000 in FY 2002, and an income of $173,500,000 in FY
2003.  Net Income to Tobacco Settlement Endowment of $0 in FY
2001, $300,000,000 in FY 2002, and $0 in FY 2003.

PROPONENTS:  Supporters say that this proposed amendment to the
constitution allows voters to affirm the use of most of the
settlement moneys for health related purposes and to exclude the
receipt of the moneys from total state revenues.

Testifying for the original bill were Representative Van Zandt;
Missouri Hospital Association; Washington University; Citizens
for Missouri's Children; Coalition on Smoking or Health; St.
Louis Regional Commerce and Growth Association; Campaign Life
Missouri; and Missouri State Medical Association.

OPPONENTS:  There was no opposition voiced to the committee.

Bill Tucker, Assistant Director of Research

HJR 61 -- Tobacco Settlement Moneys

Co-Sponsors:  Van Zandt, Gaw, Harlan, Backer, Scheve, Boucher,
Lakin

This proposed amendment to the Missouri Constitution establishes
a trust fund for receipt of any legal settlement or award
relating to tobacco-related products.  All moneys in the fund
and accrued interest would only be appropriated for programs
related to tobacco use, research for cures to tobacco-related
illnesses, access to health care and education for children and
families, and budget emergencies.