Governor Mike Johanns re-enacted the signing of legislative bill (LB)
692 on Thursday morning at the Durham Outpatient Center at the University
of Nebraska Medical Center in Omaha. Nebraskans representing each
of the designated beneficiaries of the states proceeds from the national
tobacco settlement participated in the event. LB 692 authorizes the
distribution of approximately $50 million annually for health related programs
and services across Nebraska.
This legislation is of historic importance for the entire State of
Nebraska, said Governor Johanns. Never before have we had an opportunity
to do something so meaningful and so sweeping in scope that will have such
a real and lasting impact on the health of so many Nebraskans for so many
years to come.
Under LB 692, the tobacco settlement proceeds will be allocated to behavioral
health services including mental health and substance abuse treatment,
juvenile services, minority health, developmental disabilities, respite
care, biomedical research, and public health. Representatives of
each of the seven areas spoke at the signing ceremony.
Nebraska was among a group of 46 states that agreed to a $246 billion
dollar settlement with the tobacco industry. The 1998 settlement
was a result of the states efforts to recoup money spent to care for ill
smokers. Nebraskas share of the settlement is about $1.2 billion
over a 25-year period.
In 1998, the state Legislature approved a plan distributing Nebraskas
tobacco settlement funds to health care needs through a competitive grant
process. The Legislature amended its plans for distributing the
funds in 2000 by allocating $21 million over three years for tobacco use
prevention and cessation efforts. However, in 2001, Governor Johanns
and legislative leaders including the Speaker of the Legislature, Sen.
Doug Kristensen of Minden, proposed a dramatically different approach.
Instead of spending the funds as the state received them or spending
only the interest on those funds, a plan to allocate $50 million annually
to designated health care needs was developed. The $50 million would
be a combination of principal and interest from Nebraskas share of the
tobacco settlement. As payments from the settlement were received,
they would be deposited in a Health Care Trust Fund. The principal
of the fund would grow over time causing an increasingly larger share of
the annual distribution of proceeds to be interest.
The question was how would the $50 million be distributed. Many
senators were involved in crafting the eventual compromise with the Governor
including Speaker Kristensen, Sen. Jim Jensen of Omaha chairman of the
Health and Human Services Committee, Sen. Roger Wehrbein of Plattsmouth
chairman of the Appropriations Committee, the vice chairs of the two
committees, Sen. Dennis Byars of Beatrice and Sen. Don Pederson of North
Platte, respectively, and other members of these two key committees as
well as other legislators.
The allocation of funds for the current fiscal year (FY 2002):
$10 million for biomedical research at UNMC, Creighton, UNL, and Boys
Town National Research Hospital (increasing to $14 million annually by
FY 2006)
$2.8 million for minority public health services
$9.9 million in FY 02 and $10.1 million in FY 03 for behavioral health
provider rate increases
$1.5 million for emergency protective care
$7.5 million for mental health and substance abuse capacity, including
$1 million each of the next two years for children served by the Office
of Juvenile Services
$5.7 million for county health departments for public health services,
planning infrastructure and development
$3 million in FY 02 and $5 million in FY 03 for individuals with developmental
disabilities on the waiting list for services
$1,060,000 for the respite care program
$5 million for health care grants awarded by the Nebraska Health Care
Council including $700,000 designated for grants to improve racial and
minority health