TOBACCO ROUNDUP: Counties Wrangle with Settlement Issues
Two Orange County supervisors are leaning toward a plan that would secure some or all of the county's share of the tobacco settlement in a lump sum by selling it to the private bond market. Board of Supervisors Chair Charles Smith and Supervisor Cynthia Coad said it "made sense ... to seek money up front instead of gambling on the future survival of tobacco companies." Selling the county's tobacco settlement, estimated to be $900 million over 25 years, could yield an estimated $350 million or more, according to the Orange County Register. Smith and Coad said the one-time payment would be split evenly, with half going to health care and the other half to debt reduction and prisons. If the plan is approved, it would nullify a November ballot initiative that would earmark 80% of this year's windfall for health care. The proposal quickly sparked criticism from health advocates. Michele Revelle, spokesperson for the Orange County Medical Association, called the move an attempt at "circumventing the democratic process." But Smith countered, "Securitization is the best thing to do with [the tobacco] money, irrespective of the initiative. (The tobacco companies) are going to find some way out of paying [the settlement]. ... I've got to do what I think is best for the county. ... I'm not going to argue with (the health advocates). I'm not in this to appease them" (Reed, Orange County Register, 7/6).
Ventura County Clerk Richard Dean drew the ire of county supervisors yesterday after he petitioned the county Superior Court to let him begin preparations to place Community Memorial Hospital's controversial tobacco initiative on the November ballot. The proposal -- which would give all of the county's $260 million settlement to private hospitals -- is currently under legal review. Last month, county supervisors declared the initiative illegal and ordered Dean to keep it off the ballot. But Dean contends that the board lacks the authority to prevent a public vote on the proposal. County officials called Dean's request "premature" and "a waste of taxpayer money," arguing that "no action should be taken" until a judge rules on the initiative's legality. But since the hearing is scheduled for July 19, Dean is worried that if the decision favors the initiative, he will not have enough time to complete the necessary paperwork before the Aug. 11 ballot-initiative deadline. County Chief Administrative Officer Harry Hufford noted, however, that if the initiative is deemed legal but not placed on the fall ballot, the issue "could always be put to a special election" (Kelly, Los Angeles Times, 7/7).