H.B. 260

1

TOBACCO FUND ALLOCATION AMENDMENTS
2 2004 GENERAL SESSION
3 STATE OF UTAH
4 Sponsor: Jack A. Seitz
5
6 LONG TITLE
7 General Description:
8 This bill amends the percentage of tobacco settlement funds deposited in the restricted
9 account and in the permanent state trust fund.
10 Highlighted Provisions:
11 This bill:
12 . changes the percentage of tobacco revenue deposited into the Tobacco Settlement
13 Restricted Account to 70% of the revenues received by the state from July 1, 2004
14 through July 1, 2006, and to 55% after July 1, 2006; and
15 . changes the percentage of tobacco revenue deposited into the state's permanent state
16 trust fund to 30% of the revenue received by the state from July 1, 2004 until July 1,
17 2006, and to 45% after July 1, 2006.
18 Monies Appropriated in this Bill:
19 None
20 Other Special Clauses:
21 None
22 Utah Code Sections Affected:
23 AMENDS:
24 63-97-201, as last amended by Chapter 323, Laws of Utah 2003
25 63-97-301, as last amended by Chapter 323, Laws of Utah 2003
26
27 Be it enacted by the Legislature of the state of Utah:

28 Section 1. Section 63-97-201 is amended to read:
29 63-97-201. Creation of Tobacco Settlement Restricted Account.
30 (1) There is created within the General Fund a restricted account known as the
31 "Tobacco Settlement Restricted Account."
32 (2) The account shall earn interest.
33 (3) The account shall consist of:
34 (a) until July 1, 2003, 50% of all funds of every kind that are received by the state that
35 are related to the settlement agreement that the state entered into with leading tobacco
36 manufacturers on November 23, 1998;
37 (b) on and after July 1, 2003 and until July 1, 2004, 80% of all funds of every kind that
38 are received by the state that are related to the settlement agreement that the state entered into
39 with leading tobacco manufacturers on November 23, 1998;
40 (c) on and after July 1, 2004 and until July 1, [2007, 50%] 2006, 70% of all funds of
41 every kind that are received by the state that are related to the settlement agreement that the
42 state entered into with leading tobacco manufacturers on November 23, 1998;
43 (d) on and after July 1, [2007, 40%] 2006, 55% of all funds of every kind that are
44 received by the state that are related to the settlement agreement that the state entered into with
45 leading tobacco manufacturers on November 23, 1998; and
46 (e) interest earned on the account.
47 (4) To the extent that funds will be available for appropriation in a given fiscal year,
48 those funds shall be appropriated from the account in the following order:
49 (a) $7,000,000 to the Department of Health for the Children's Health Insurance
50 Program created in Section 26-40-103 and for restoration of dental benefits in the Children's
51 Health Insurance Program;
52 (b) $4,000,000 to the Department of Health for alcohol, tobacco, and other drug
53 prevention, reduction, cessation, and control programs that promote unified messages and
54 make use of media outlets, including radio, newspaper, billboards, and television, and with a
55 preference in funding given to tobacco-related programs;
56 (c) $193,700 to the Administrative Office of the Courts and $1,296,300 to the
57 Department of Human Services for the statewide expansion of the drug court program;
58 (d) $77,400 to the Board of Pardons, $81,700 to the Department of Corrections, and

59 $350,900 to the Department of Human Services for a drug board pilot program;
60 (e) $4,000,000 to the State Board of Regents for the University of Utah Health
61 Sciences Center to benefit the health and well-being of Utah citizens through in-state research,
62 treatment, and educational activities; and
63 (f) any remaining funds as directed by the Legislature through appropriation.
64 (5) (a) If tobacco funds in dispute for attorneys fees are received by the state, those
65 funds shall be divided and deposited in accordance with Subsection (3) and Section 63-97-301 .
66 (b) The amount appropriated from the Tobacco Settlement Restricted Account to the
67 Department of Health for alcohol, tobacco, and other drug programs described in Subsection
68 (4)(b), including the funding preference for tobacco-related programs, shall be increased by up
69 to $2,000,000 in a given fiscal year to the extent that funds in dispute for attorneys fees are
70 available to the state for appropriation from the account.
71 (6) Each state agency identified in Subsection (4) shall provide an annual report on the
72 program and activities funded under Subsection (4) to:
73 (a) the Health and Human Services Interim Committee no later than September 1; and
74 (b) the Health and Human Services Joint Appropriations Subcommittee.
75 Section 2. Section 63-97-301 is amended to read:
76 63-97-301. Permanent state trust fund.
77 (1) Until July 1, 2003, 50% of all funds of every kind that are received by the state that
78 are related to the settlement agreement that the state entered into with leading tobacco
79 manufacturers on November 23, 1998, shall be deposited into the permanent state trust fund
80 created by and operated under Utah Constitution Article XXII, Section 4.
81 (2) On and after July 1, 2003 and until July 1, 2004 20% of the funds of any kind
82 received by the state that are related to the settlement agreement that the state entered into with
83 leading tobacco manufacturers shall be deposited into the permanent state trust fund created by
84 and operated under Utah Constitution Article XXII, Section 4.
85 (3) On and after July 1, 2004 and until July 1, [2007 50%] 2006, 30% of all funds of
86 any kind received by the state that are related to the settlement agreement that the state entered
87 into with leading tobacco manufacturers shall be deposited into the permanent state trust fund
88 created by and operated under Utah Constitution Article XXII, Section 4.
89 (4) On and after July 1, [2007, 60%] 2006, 45% of all funds of every kind that are

90 received by the state that are related to the settlement agreement that the state entered into with
91 leading tobacco manufacturers on November 23, 1998, shall be deposited into the permanent
92 state trust fund created by and operated under Utah Constitution Article XXII, Section 4.
93 (5) Funds in the permanent state trust fund shall be deposited or invested pursuant to
94 Section 51-7-12.1 .
95 (6) (a) In accordance with Utah Constitution Article XXII, Section 4, the interest and
96 dividends earned annually from the permanent state trust fund shall be deposited in the General
97 Fund. There shall be transferred on an ongoing basis from the General Fund to the permanent
98 state trust fund created under Utah Constitution Article XXII, Section 4, an amount equal to
99 50% of the interest and dividends earned annually from the permanent state trust fund. The
100 amount transferred into the fund under this Subsection (6)(a) shall be treated as principal.
101 (b) Any annual interest or dividends earned from the permanent state trust fund that
102 remain in the General Fund after Subsection (6)(a) may be appropriated by the Legislature.
103 (c) Any realized or unrealized gains or losses on investments in the permanent state
104 trust fund shall remain in the permanent state trust fund.




Legislative Review Note
as of 1-28-04 9:02 AM

A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel