ARIZONA STATE SENATE
Phoenix, Arizona
REVISED
tobacco products tax; health
services
Increases the tobacco tax for health care and
allocates the new revenue to various health care programs, including the
Medicaid expansion, uncompensated care, trauma center readiness costs, disease
research contracts, prevention and early detection programs and other health
care services programs.
On November 9, 1994, Arizona voters approved
Proposition 200, the Tobacco Tax and
Health Care Act, increasing the state’s tax on tobacco products as follows:
Revenues collected as a result of the increased tax
are deposited in the tobacco tax and health care fund. The initiative allocated monies in the fund
as follows:
If approved by the voters, S.C.R. 1022 increases the
1994 tobacco tax for health care rates by one and one-half. According to Joint Legislative Budget
Committee staff’s preliminary estimates, this increase would generate
approximately $150.9 million annually, excluding loss of revenue due to the
elasticity on the existing tobacco tax.
The referendum requires the new tobacco tax revenue to be deposited into
the tobacco products tax fund and allocated as follows:
1. Establishes the tobacco products tax fund consisting of revenues generated by increasing the tobacco tax for health care rates, that were in effect on January 1, 2002, by one and one-half and interest earned on those revenues. Requires the AHCCCS administration to administer the fund.
2. Allocates monies in the fund as follows:
a. 42 percent to the proposition 204 protection account.
b. 27 percent to the medically needy account.
c. 20 percent to the emergency health services account.
d. 5 percent to the health research fund.
e. 4 percent to the health care adjustment account.
f. 2 percent to the health education account.
3. Specifies monies in the fund are continuously appropriated, nonreverting and exempt from lapsing.
4. Recodifies the health education account
5. Allows the Department of Health Services (DHS) to use account monies for audits of both the account and tobacco education prevention programs.
6. Requires DHS to use monies deposited in the account from the tobacco products tax fund for prevention and early detection programs on the four leading disease-related causes of death in this State.
7. Stipulates the initial diseases are cancer, heart disease, stroke and pulmonary disease.
8. Eliminates the requirement of the Auditor General to conduct an evaluation of health education account programs.
9. Establishes the emergency health services account under the administration of AHCCCS.
10. Requires, subject to legislative appropriation, the AHCCCS administration to use account monies only for the reimbursement of uncompensated care and trauma center readiness costs.
11. Specifies unexpended and unencumbered monies as of June 30 each year revert to the proposition 204 protection account.
12. Establishes the health care adjustment account under the administration of the Department of Revenue (DOR).
13. Requires, by January 1 each year, DOR to transfer account monies to the medically needy account, health education account and health research account to compensate for decreases in deposits from the tobacco tax and health care fund due to the increased tobacco tax.
14. Specifies the balance of account monies after the transfers are made reverts to the tobacco products tax fund for distribution to the proposition 204 protection account, health research fund, medically needy account and emergency health services account.
15. Establishes the proposition 204 protection account under the administration of AHCCCS.
16. Requires the AHCCCS administration to use account monies for the AHCCCS expansion for eligible persons up to 100 percent of the federal poverty level.
17. Requires the AHCCCS administration to spend the account monies prior to spending monies in the Arizona tobacco litigation settlement fund.
18. Requires, by January 1, 2004, the Legislature to establish a commission to advise and consult DHS on the goals, objectives and activities of tobacco education prevention programs.
19. Requires the commission to include members with expertise in public health services, tobacco cessation and addiction programs, school-based tobacco education programs, marketing or public relations, and research and evaluation of public health programs.
20. Transfers health education account monies to the recodified account.
21. Specifies the referendum is not effective if an initiative that increases the tax on tobacco products receives more votes.
22. Contains an intent clause.
23. Makes conforming changes.
24. Becomes effective on approval by a majority of the voters and on proclamation of the Governor.
1. Includes interest earnings in the tobacco products tax fund.
2. Replaces, under the distribution of monies from the tobacco products tax fund, the health research account with the health research fund.
3.
Requires
emergency health services account monies to be used only for uncompensated care and trauma center readiness costs.
4.
Subjects
the emergency health services account to legislative appropriation.
5.
Bases
the tax increase on the tobacco tax for health care rates that were in effect
on January 1, 2002.
6.
Diverts
two cents of the distribution of monies from the health research fund to the
health education account for prevention and early detection programs.
7.
Maintains
the restriction on the use of health education account monies for tobacco
education prevention programs.
8.
Eliminates
the requirement of the Auditor General to evaluate health education account
programs.
9.
Allows
DHS to use health education account monies for audits of both the account and
tobacco education prevention programs.
10.
Replaces
the conditional enactment clause.
11.
Adds
an intent clause.
12.
Makes
several conforming and technical changes.
HEA 5/6/02 DPA 6-0-2-0
Prepared by Senate Staff
May 7, 2002