2 tobacco settlement funds end in NC House budget

RALEIGH, N.C. — House Republicans want to abolish two trust funds that receive half of North Carolina’s share of the national tobacco settlement and intercept money from the third – a direction health and economic development advocates contend will raise youth smoking rates and discourage economic recovery.

The GOP-penned state budget proposal heading to floor debate Tuesday would eliminate by Dec. 31 the Health and Wellness Trust Fund and the Tobacco Trust Fund. The two funds have cumulatively received more than $900 million from the 1998 tobacco settlement with 46 states, including about $69 million this year.

The Golden LEAF Foundation, which gets the other half of the state’s share and gives out grants, scholarships and economic sweeteners to help small towns and others once dependent on tobacco, wouldn’t receive its $68 million annual payment for the next two years. It would keep operating and retain $600 million in assets it now holds.

The General Assembly has required the tobacco and health trust funds to give up about half of their annual over the years for university building construction, cancer research and filling shortfalls in the state’s general operating budget. The health trust fund has offered grants to boost anti-smoking and anti-obesity efforts and the trust fund to help farmers switch to different crops since they were created in 1999.

The two now have so little money without strings attached it doesn’t make sense to keep in place the funds or the commissions that operate them, said House Majority Leader Paul Stam, R-Wake.

Democratic Gov. Beverly Perdue is likely to take issue with any final budget bill she’ll be asked to sign into law that contain the trust fund changes. Perdue was chairwoman of the Health and Wellness Trust Fund while she was lieutenant governor.


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