VENTURA COUNTY: Tobacco Funds Will Remain Unallocated Until Judge Rules

      Ventura County's $15.3 million in tobacco settlement funds will remain unallocated until the legal battle over how to spend the money is resolved, the Ventura County Star reports. Interim Chief Administrative Officer Harry Hufford said yesterday that although the $7.3 million remainder from last year's tobacco payment and the entire $8 million windfall for this year are reported in his proposed budget, the funds will not be doled out until a judge decides whether the county supervisors can block a ballot initiative that would give the money to the area's private hospitals. Officials hope the decision to hold off on allocation will "deflect criticism for initiative supporters who charge the county is using the money to undo past fiscal mismanagement." Additionally, the strategy would "leave the money available for transfer in the event the hospital gains control of it," the Star reports. Supervisor Judy Mikels said, "It makes no sense to spend it now. If we lose the lawsuit ... we still have budget problems. ... I fully believe all the departments can tighten their belts and do what it takes." But Supervisor John Flynn said he may propose giving at least some of the money to the Behavioral Health Department, which faces $2 million in budget cuts. Supervisor Frank Schillo said he might support authorizing some tobacco funds for mental health programs, but wondered about the "legal questions surrounding such expense" (O'Donnell, 6/23).

New Precedent?
      The county's lawsuit against Community Memorial Hospital, which sponsored the ballot initiative, could be "precedent-setting," the Los Angeles Times reports. According to Schillo, "If this [initiative] passes, it would be very easy for anyone to get people to vote to take away money from cities' and counties' general funds." Legal experts add that the case raises several key questions, including: "Can voters dictate through the initiative process how their county's or city's share of this settlement and future windfalls from lawsuits can be spent?" and "If this initiative is upheld, will the tobacco settlement essentially disappear as a supplemental funding source for general government programs?" (Talev, 6/22).