Pennsylvania Finance Building

Auditor General Raises Red Flag on Tobacco Settlement Fund

Jack Wagner

Jack Wagner meets with the news media on Thursday

Fresh off of a series of five statewide public hearings, Auditor General Jack Wagner has delivered a special report to state lawmakers.  “It’s about time the General Assembly steps to the plate and listens to what the public is talking about in relation to their dollars, these tobacco settlement dollars,” Wagner said at a Thursday news conference.  “Overwhelmingly, in 99.9% of all the testimony we heard, the public wants these dollars to be spent for health-related purposes.”  Wagner says that was the intent behind the Tobacco Settlement Act of 2001, but about $1.3-billion dollars has been quietly diverted to other budget purposes over the past six years. 

Pennsylvania has been receiving $350-million tobacco settlement dollars a year, and is expected to continue to receive that money for at least the next 15-years.  Two of the high-profile uses spelled out in Act 77 of 2001 were the adultBasic health insurance program, and tobacco use prevention and cessation programs.  The adultBasic program expired earlier this year due to a lack of funds, but Wagner says it can still be salvaged with a combination of public and private financing.  “There is a significant need for it to continue,” Wagner says.  “There were 42,000 people on the rolls of adult basic and there were almost 500,000 on the waiting list.” 

When it comes to tobacco cessation programs, Wagner was flanked by a chart that shows they received $50.5-million dollars in funding for fiscal year 2003, but only $14.7-million in FY2011.  He says 20,000 Pennsylvanians die of smoking-related illnesses each year.  “We are hopeful that what has happened over the last five or six years does not continue to happen in this budget,” Wagner said, upon delivering his special report to legislative leaders and Governor Tom Corbett.  A Senate Republican spokesman confirms that the Tobacco Settlement Fund will be discussed during the upcoming budget negotiations, but he could not speculate as to the result of those talks.