California voters narrowly reject new tobacco tax

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Finally some good news to report about California.

http://news.yahoo.com/california-voters-narrowly-reject-tobacco-tax-191721006--finance.html

By HANNAH DREIER | Associated Press – 1 hr 32 mins ago

SACRAMENTO, Calif. (AP) — A California initiative to increase the tax on tobacco to pay for cancer research has failed by less than a percentage point after remaining too close to call for more than two weeks.

With about 5 million ballots cast, opponents of Proposition 29 led by about 28,000 votes. The Associated Press analyzed areas where the roughly 105,000 uncounted votes remain and determined Friday there were not enough places where "yes" was winning to overcome the deficit.

As Prop 29 was failing 49.7 percent to 50.3 percent, proponents called it the narrowest defeat of a statewide ballot measure in California's history.

The plan to add $1 to the cigarette tax was headed by cyclist Lance Armstrong, a cancer survivor. Tobacco companies, led by Philip Morris, meanwhile pushed the opposition campaign, pouring millions of dollars into an advertising blitz that whittled away support. Polls showed approval peaked around two-thirds in March but had fallen dramatically by the June 5 balloting.

Support for the initiative was strongest in the San Francisco Bay Area, while more conservative places like Southern California's Inland Empire opposed it.

If the measure had passed, Californians would still have paid only the 16th highest tobacco tax in the nation, at $1.87 per pack.

Proponents said they would be back.

"This came so close, I think this is worth another try," said Stan Glantz of the University of California, San Francisco's Center for Tobacco Control Research and Education. "I think it would be horrible if Philip Morris and Reynolds get away with this."

He suggested that cigarette tax supporters might turn to the Legislature, though lawmakers routinely reject attempts to raise tobacco taxes.

The opposition campaign will wait until all the votes have been counted before declaring victory, spokeswoman Beth Miller said.

Opponents of the measure raised $47 million to fight it, a huge sum even by California standards. By comparison, Jerry Brown spent about $36 million in his successful 2010 bid to become governor of California. Wisconsin Gov. Scott Walker and his allies spent $47 million to beat back his recall challenge on June 5.

Armstrong and a coalition of anti-smoking groups raised about $12 million to bolster the measure, including $500,000 from New York City Mayor Michael Bloomberg.

In a statement Friday, Lance Armstrong Foundation President Doug Ulman framed the issue as one of life and death.

"The defeat of this life-saving initiative is a genuine tragedy," he said. "Big Tobacco lied to voters to protect its profits and spent $50 million to ensure it can continue peddling its deadly products to California kids."

While raising the price of tobacco has been shown to reduce smoking rates, especially in young people, campaign ads sponsored by tobacco companies focused on pocketbook issues. The ads noted money would be raised in California through the tax but wouldn't necessarily stay in the state for research. The campaign also raised the specter of an out-of-control bureaucracy that would be set up to oversee collection and distribution of the money.

The strategy didn't just stir doubt in the minds of voters.

Several major newspapers, including The Los Angeles Times, opposed the measure while expressing general support for such sin taxes and reluctance to side with tobacco companies. They argued that the revenue should go directly to the state, which now faces a $15.2 billion deficit.

The result was reminiscent a 2006 California cigarette tax measure that led by wide margins in early polling until tobacco companies spent $66 million to defeat it with ads featuring physicians.

Prop 29 was failing by a remarkably slim margin. Previously, the closest vote in the past two decades was on school bond measure 1B in 1994, which failed 49.6 percent to 50.4, according to Secretary of State spokeswoman Shannan Velayas. The second closest was another tobacco tax measure, which passed 50.5 percent to 49.5 percent in 1998.

California was once at the forefront of smoking restrictions and taxes, but the famously health-conscious state has not raised tobacco taxes since 1998. If the new tax had passed, California would still have had only the 16th highest tax rate in the nation.

Some smoking foes said they are weighing the idea of tackling the issue in the state Legislature.

The overwhelming majority of recent tobacco taxes across the nation have been approved in statehouses, not at the polls. But in California, where new taxes require a two-thirds vote in the Legislature, lawmakers have defeated more than 30 attempts to raise tobacco taxes in the last 30 years.

Missouri voters are expected to weigh in on a tobacco tax increase in November and similar taxes are working their way through the legislative process in the Rhode Island, Massachusetts and Illinois.

Edited June 23, 2012 by Bad_Daddy