The CDC studied state income from tobacco taxes and settlement payments along with state spending on tobacco control and investment from 1998 to 2010. The analysis found that states had spent a combined $8.1 billion on efforts to reduce tobacco use -- $21.1 billion less than they would have if states followed the CDC’s Best Practices for Comprehensive Tobacco Control released in 1999.
According to the CDC analysis, the $641.1 million that states spent on tobacco prevention initiatives in 2010 amounted to only 2.3 percent of their tobacco revenue (nearly $24 billion). The Campaign for Tobacco-Free Kids has estimated that states would have to spend 15 percent of their tobacco-related income to fully fund their anti-smoking programs.
In 1998, 46 states plus the District of Columbia reached an agreement with the tobacco industry in which the tobacco companies pledged to provide $206 billion in revenue to states. The other four states reached separate agreements with the industry worth $40 billion. The money was intended to offset increased state Medicaid spending because of tobacco-related diseases, according to the CDC, but the agreement (or Congress) did not stipulate that states had to spend the new revenue on tobacco control and prevention efforts.
In 1999, the CDC released its Best Practices recommendations, seeking to guide states on how to ensure some of the money went toward effectively reducing tobacco use. The federal government initially suggested that states spend at least $1.6 billion annually on those initiatives; that number was increased to $3.7 billion in 2007.
From 1998 to 2010, states collected $243.8 billion in revenue from the tobacco companies and taxes on cigarette. Those figures provided the basis of the CDC’s analysis released Friday.
The average state cigarette tax increased from $0.39 per pack to $1.44 per pack over the study period (taxes range from $0.17 in Missouri to $4.35 in New York), and revenue more than doubled to $17.4 billion in 2010. Settlement payments from the tobacco industry grew from $1.4 billion in 1998 to $7.4 billion in 2010.
Yet, since peaking in 2002 at $820.9 million, state spending on tobacco use prevention has steadily declined to $641.1 million in 2010. That is still up from $262.3 million in 1998, but 2010 spending levels are only 17.3 percent on the CDC’s recommended investment.
Instead, states are increasingly using tobacco money for general purposes or to cover budget shortfalls (which reached an estimated $191 billion in fiscal year 2010, according to the Center on Budget and Policy Priorities).
The CDC highlighted a few states that had sustained investment in tobacco control and the results that they had seen. California, for example, came closest to initially meeting the federal government’s 1999 Best Practices recommendations and has maintained its funding levels since. Adult smoking rates have declined from 22.7 percent in 1988 (when California first initiated an increased cigarette tax) to 13.1 percent in 2010. According to the CDC, 19.3 percent of American adults currently smoke.
CDC tables on state tobacco-related income and anti-smoking spending are below.
