Tobacco Settlement Agreement Fund Oversight Committee




<MeetMDY1> October 3, 2012


Call to Order and Roll Call

The<MeetNo2> meeting of the Tobacco Settlement Agreement Fund Oversight Committee was held on<Day> Wednesday,<MeetMDY2> October 3, 2012, at<MeetTime> 10:00 AM, in<Room> Room 129 of the Capitol Annex. Representative Wilson Stone, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Paul Hornback, Co-Chair; Representative Wilson Stone, Co-Chair; Senators David Givens, Vernie McGaha, Dennis Parrett, and Joey Pendleton; Representatives Royce W. Adams, Terry Mills, Ryan Quarles, and Tommy Turner.


Guests: Mr. Roger Thomas, Mr. Joel Neaveill, Mr. Bill McCloskey, Mr. Brian Murphy, Ms. Angela Blank, and Mr. Biff Baker Governorís Office of Agricultural Policy; Ms. Irene Centers and Ms. Angela Criswell, Department for Public Health; Mr. Josh Crain, Department of Alcoholic Beverage Control; Mr. Steve Cambron,
Department for Behavioral Health; and Mr. Randy Gooch, Jessamine County Health Department.


LRC Staff: Lowell Atchley, Kelly Ludwig, and Ashlee McDonald, Committee Assistant.

The September 5, 2012, minutes were approved, without objection, by voice vote, upon motion by Senator Parrett and second by Representative Quarles.

Governorís Office of Agricultural Policy

The committee received the monthly report from Mr. Roger Thomas, Executive Director, Mr. Joel Neaveill, Chief of Staff, and Mr. Bill McCloskey, Director of Financial Services, Governorís Office of Agricultural Policy (GOAP), regarding project funding decisions made by the Agricultural Development Board (ADB) during its September meeting.

GOAP officials summarized funding allocations under the County Agricultural Improvement, Deceased Farm Animal Disposal Assistance, and Shared-Use Equipment programs from the previous month.

The committee discussed the methods used in and funding alternatives for deceased farm animal disposal. Representative Mills described to the committee a field day he attended in Casey County, at the Large Animal Composting of Kentucky composting operation, which received $22,500 in agricultural development funds last June. The operation serves farmers in several south central Kentucky counties.

Responding to committee membersí questions, Mr. Thomas indicated the Casey County operation is the only regional composting operation and is a pilot project for other potential composting operations. According to Mr. Thomas, some counties offer deceased livestock disposal services at no charge while others assess charges. Some disposal takes place in landfills.

Replying to Representative Adams, GOAP staff went over the Casey County operationís disposal fees.

As the discussion ended, Mr. Thomas said that he considered cost-share investments in deceased farm animal disposal to be ďone pieceĒ in the overall investments made in Kentuckyís growing livestock industry.

Mr. Neaveill summarized four projects that received funding under the ADBís 2012 Farmersí Market Infrastructure Competitive Grant Program. The markets included: the Lincoln County Farmersí Market, the UK Robinson Center Farmersí Market in Breathitt County, a Muhlenberg County farmersí market sponsored by the Muhlenberg County Fiscal Court, and the Owsley County Farmersí Market on the grounds of the Owsley County school system. The amounts awarded, to be matched with local funds, ranged from $20,500 to $40,000.

Responding to Co-Chair Hornback, the GOAP officials said there was no review of the marketsí bylaws regarding how they screen sellers. Mr. Thomas noted that applications for farmersí market funding generally come with broad-based support from the communities applying and described to Co-Chair Stone how facility and grounds ownership are dealt with.

Mr. Thomas also responded to Senator Givensí question about court proceedings involving a portion of 2003 Master Settlement Agreement payments being disputed by some participating tobacco companies that claim a lost market share over time. Potentially, reduction of multistate MSA payments could total over a billion dollars.

†According to Mr. Thomas, Kentuckyís legal counsel will be arguing before a federal arbitration panel in April. Since dozens of states are involved, the hearing process could be drawn-out.


Tobacco Prevention and Cessation Program

††††††††††† The committee received the annual report from officials with the Tobacco Prevention and Cessation Program in the Department for Public Health. The program received almost $2,124,000 in tobacco settlement fund appropriations for FY 2013. Coupled with federal funds, the money is used for tobacco cessation interventions, state and community interventions, health communication, and administration and management. Program officials addressing the committee included: Ms. Irene Centers, Health Promotion Branch Manager, and Ms. Angela Criswell, Tobacco Control Manager.

††††††††††† The committee heard reports from Mr. Josh Crain, Assistant Director of Enforcement, Department of Alcoholic Beverage Control (ABC), Mr. Steve Cambron, Synar Coordinator with the Substance Abuse Prevention Branch, and Mr. Randy Gooch, Public Health Director with the Jessamine County Health Department.

††††††††††† Mr. Crain described the way the ABC goes about performing random checks at tobacco retail stores, often using teenagers working undercover to attempt to make purchases. The agency made 3,280 inspections in 2011, with 120 violations found. Since July 2011, the ABC has performed tobacco inspections under a U.S. Food and Drug Administration contract.

††††††††††† Senator Pendleton indicated he was concerned about the idea of using older-looking undercover buyers, thereby confusing some retailers. Mr. Crain made note of the senatorís concerns while also saying there are protocols in place to use age-appropriate buyers. He said the intent is to check for compliance with tobacco retail laws.

††††††††††† Mr. Cambron discussed the stateís enforcement role in the Synar law, named after a U.S. congressman who sponsored the legislation in the early 1990s. One aspect of the program is to track data on retailers caught for selling tobacco to underage persons. Kentucky had a 5.7 percent violation rate in 2011. The rate has declined or remained at that level for a number of years. Also, Kentuckyís Synar violation rate is well below the national average and has been that way for a number of years.

††††††††††† Responding to Senator Pendleton, Mr. Cambron said it is not determined to what extent youth obtain cigarettes and the like from relatives or others, but he acknowledged there is social access. Senator Pendleton suggested those questions need to be asked.


††††††††††† Responding to a question from Senator Givens, the witnesses described the working relationship between ABC and the Synar program.

Mr. Gooch discussed how his health department budgets for and handles the funds awarded to it and reports on the spending. He described some of the local programs.

††††††††††† Responding to Representative Stone, Mr. Gooch acknowledged that his agency has had to deal with funding declines in recent years because of ongoing budget constraints.

††††††††††† Ms. Criswell described some of the programs within her agency. Those include efforts to establish 100 percent tobacco-free schools, the TRUST tobacco retailer underage sales training, the tobacco toll-free quit line, and efforts to see smoke-free laws passed. The agency will be establishing a Web site to help people quit smoking. She mentioned some of the comments recorded from people who quit smoking in 2011.

††††††††††† Documents distributed during the committee meeting are available with meeting materials in the LRC Library.

††††††††††† The meeting adjourned at approximately 11:45 a.m.