Erosion of the Health Education Account: 1990-1994
Proposition 99's anti-tobacco programs were off to a good start. The
media campaign had achieved high visibility within California and attracted international
acclaim. The local programs were up and running, and local clean indoor air ordinances and
tobacco control measures were passing at a faster rate. On October 30, 1990, the
Department of Health Services (DHS), which was implementing all the Proposition 99
anti-tobacco education programs except the school-based programs, estimated that
California had 750,000 fewer smokers than it would have had if Proposition 99 had not
passed, that the percentage of smokers over the age of twenty had dropped from 24.6
percent to 21.2 percent, that tobacco consumption was down 14 percent, and that between 62
percent and 85 percent of the target groups were aware of the media campaign. With such a strong early-performance record, public health
advocates should have been in a position to protect the Health Education Account from the
tobacco industry and its allies who wanted to see more money go to medical services.
AB 75's sunset provision took effect on June 30, 1991, only twenty-one
months after passage, so the Legislature had to enact new implementing legislation for
Proposition 99 in 1991. This situation created a new opportunity for the tobacco industry
and its allies to dismantle the anti-tobacco programs. The health groups believed that
their earlier compromise with the California Medical Association (CMA) and other medical
interests ”allowing a relatively small amount of money to be taken from the Health
Education Account to fund medical services like the Child Health and Disability Prevention
program (CHDP) ”would protect the anti-tobacco programs from further incursions. They
The state was facing a budget shortfall, which further motivated groups
interested in funding medical services to raid the Proposition 99 Health Education
Account. Ironically, the very success of the Tobacco Control Program in reducing tobacco
consumption magnified this problem: less smoking meant fewer cigarettes sold, which meant
lower Proposition 99 tobacco tax revenues. Public health groups recognized from the
beginning that the Health Education revenues would decline naturally as smoking did and
that, as the program succeeded in reducing tobacco consumption, it would become less
necessary. But they did not anticipate that medical service providers would work to cut
health education funds faster than the natural rate of decline. For medical service
providers, who faced escalating costs and a growing population demanding services, a drop
in revenue due to less smoking motivated them to fight for a bigger piece of the shrinking
In addition, the tobacco industry was continuing to make substantial
campaign contributions to most members of the Legislature, with especially heavy donations
going to the leadership. In the 1991-1992 election cycle, the industry spent $5.8 million
on campaign contributions and lobbying in California. Because of the importance of
Proposition 99, the tobacco industry spent $3,772 per member in the California Legislature
in 1989-1990, compared with only $2,451 per member in the US Congress.
In particular, the industry increased contributions to Assembly Speaker Willie Brown, who
was uniquely positioned to defend the industry's interests.
California also had a new governor. In November 1990 Pete Wilson was
elected to succeed George Deukmejian. While both were Republicans, their attitudes toward
initiatives differed. Deukmejian might oppose an initiative during an election (as he had
Proposition 99), but he would then respect the will of the voters and make an honest
effort to implement any initiative that passed, including Proposition 99.
By contrast, Wilson believed that it was his prerogative to massage
Legislative activity surrounding Proposition 99 began in the fall of
1990 with the formation of a steering committee of the organizations that had been most
interested in AB 75, including the voluntaries, the CMA, California Association of
Hospitals and Health Systems (CAHHS), Service Employees International Union (SEIU),
Western Center for Law and Poverty, and others. The committee was to provide a forum for
the groups to communicate with each other about new legislation. According to American
Lung Association (ALA) lobbyist Tony Najera and Senator Watson's chief of staff, John
Miller, the steering committee and Assembly Member Phil Isenberg (D-Sacramento), who had
chaired the Conference Committee that wrote AB 75, agreed to extend the existing programs
and distribution formulas without substantive changes, to share pro rata in the 14-18
percent reduction in revenues, and to minimize conflicts and press for fast-track passage
of legislation authorizing the Proposition 99 programs by March 1991.
In light of the political deal that the public health advocates had made to ensure AB 75's
passage as well as the newness of the programs, this was not an unreasonable position. The
debate was becoming simply how to divide up another pie in Sacramento.
On January 7, 1991, the three voluntaries, the CMA, CAHHS, SEIU, Western
Center for Law and Poverty, and other interested parties wrote to Isenberg and the other
members of the Conference Committee, urging them to extend the provisions of AB 75:
Our organizations have worked together through-out the implementation
phases of AB 75 to assure that legislative policy objectives are being achieved. We now
join in urging your support for a three year extension of the provisions of AB 75, as
contained in AB 99 (Legislative Session 1991-92), in order to assure the continuation of
the programs and services that are funded with these tobacco tax proceeds. In order to
secure a stable and efficient administration at both the state and local level, it is
critical to obtain an extension of the provisions of AB 75 well in advance of the sunset
This reauthorization strategy meant that if everyone played by
the rules, then programmatic issues related to the allocation of money would not be
raised, including the issue of using the Health Education Account to fund CHDP. The health
groups felt that this was the best strategy to avoid further erosion in funding of
anti-tobacco education because it would not force them to defend the efficacy of the
Tobacco Control Program, which was just building steam. They did not want to appropriate
Health Education Account money in a bill separate from the medical service accounts
because doing so would isolate funding for the anti-tobacco program and make it a better
target for the tobacco industry and its allies.
The public health groups honored their side of the agreement, although
it meant accepting the continued diversion of funds from the Health Education Account into
medical services. The Tobacco Education Oversight Committee (TEOC), the committee created
by the Legislature to provide advice about Proposition 99 implementation, supported using
Health Education Account money for CHDP. TEOC's position was articulated through
statements by its chair, Carolyn Martin, a volunteer with ALA, and Jennie Cook, a
volunteer with ACS. At a January 23 press conference, Martin described the activities
funded by the Health Education Account, including CHDP: The prevention message
is reaching every group targeted by the enabling legislation (AB 75) in settings as
diverse as fast food restaurants, clinic waiting rooms and half time at the Chargers-49ers
exhibition game.  Jennie Cook explicitly justified the
use of Health Education Account funds for medical services: Pregnant women who
smoke become parents who smoke around their young children causing increased respiratory
illness, ear infections, and reduced growth. Education efforts have begun in many prenatal
care settings and maternal and child health programs.  No
one was willing to question whether CHDP should continue to receive funding from the
Health Education Account.
The CMA Position
In contrast to the voluntary health agencies, which demonstrated
commitment to all programs, the CMA was soft on the issue of funding programs other than
medical services. Although the CMA signed the January 1991 letter to Isenberg, on November
10, 1990, the CMA Council had adopted a recommendation that the existing Proposition 99
expenditure patterns be extended until CMA's affordable basic care proposal or
a similar proposal is implemented.  AB 75 distributions
were acceptable only until the money was needed to pay for indigent health care. According
to CMA Resolution 9021-90,
(1) CMA supports funding of tobacco education programs through the
years 1990 and 1991, as approved by the voters of California in Prop. 99. (2) CMA will
monitor the progress of the State's evaluation of the effectiveness of the
Prop. 99 health education account. (3) CMA will work in conjunction with the
legislature and with other groups interested in tobacco education and access to care,
toward the goal of utilizing tobacco tax revenues for access to care as soon as
feasible, while maintaining adequate funding for tobacco education.
The council had reiterated its basic position that using Health
Education dollars for public health programs was an interim measure, that funding health
care was the preferred policy, and that anti-tobacco education was entitled only to
adequate funding, not full funding.
In 1990, when chief CMA lobbyist Jay Michael was questioned about CMA
policy by Lester Breslow, a member of the TEOC and former dean of the UCLA School of
Public Health, Michael responded, The CMA's policy relating to the
distribution of Prop 99 monies until June 30, 1990, was consistent with our long-range
policy relating to the ultimate use of Prop 99 funds in the future. ¦CMA's general
policy for the short term was to ensure that physicians received their fair share of the
health care funding provided by Prop 99, which was intended to temporarily patch up our
health care delivery system until such time as an overall solution can be achieved to
address our most serious health care problems.  He went
on to reiterate the CMA position emphasizing that $30 million is enough to mount a massive
campaign in the schools and that a public media campaign is not likely to be effective.[13-15]
The CMA was also prepared to contest the evaluation data that showed the
programs' effectiveness. When interviewed in 1993, Michael expressed his attitude about
Did you read the study that was done by the Department of Health
Services or commissioned by the Department of Health Services? I think that's a sloppy
study; it's undocumented; the conclusions, or the data do not support the conclusions.
¦Why? Because the money was vulnerable to being diverted to other purposes in a
tight state budget year. And they were desperate and it was a survival response. And I
don't fault them for that. I've been in this business for a long time, and that's the way
people behave. It's very hard to be judgmental about things like that. ¦But to
cloak their biased stacked study in objectivity is offensive to me. ¦The issue is:
is that the most cost-effective way to use that money to improve health and to reduce the
amount of tobacco addiction? And I don't think that study has ever been made. As an
advocate of the point of view that it ought to be given to health care providers and
health care providers should be educated, trained to get people to stop smoking, I'm
advocating that. I don't have a clue as to whether that's the most cost-effective way to
use the money. I'm saying it ought to be evaluated along with every other kind of use of
that money by someone who really does an objective
job. And the money shouldn't be split up on the basis of these hokey trumped-up biased
advocates for a particular interest group.
For the public health groups, or the dread disease
organizations, as Michael called them, these comments were not those of someone who
wanted to maintain the status quo.
The CMA's most immediate concern was to prevent any drop in money for
health services. The maintenance of effort clause in Proposition 99,
which required that the new tobacco tax money be used to supplement rather than replace
existing state funding, was an issue in the fall of 1990. The 1990-1991 state budget had
reduced funding for county Medically Indigent Service Programs and for Medical Services
Programs. According to the CMA Council minutes, most counties believed that they could not
maintain existing levels of service and thus would not be able to qualify for Proposition
99 funds, so they had asked to have the maintenance of effort requirement waived for
fiscal year 1990-1991. The CMA went on record as opposing any waiver of maintenance of
At the same time, on November 1, 1990, the Tobacco Institute was also
planning its 1991 legislative strategy for neutralizing Proposition 99. The main goal was
to divert the media funds, and the institute saw a chance to achieve
The decrease in revenues will increase the competition for funding in
the 91-92 budget among the various program elements. Additionally, California is expecting
a shortfall of as much as $2 billion, possibly more, in the next fiscal year. That will
tempt the new administration and the Legislature to supplant existing general fund
revenues with Proposition 99 revenues where appropriate programs exist. The women, infants
and children and the health screening programs are appropriate programs since they contain
anti-tobacco education elements and would satisfy the dictates of Proposition 99 ¦ .
Proposition 99 revenues are down which will pit the sponsors of the
initiative against one another as they seek funding for their favorite programs. Confusion
and animosity will result. ¦A coalition of interests could be built to chase the
media money. The nucleus of such a coalition could be the minority health communities
which feel not enough of the Proposition 99 money is getting to the streets. Other
coalition members would be the rural counties, a few of which are facing bankruptcy.
Public hospitals desperately need money to fund trauma centers. Other interest groups
would join the chase if they thought the money were in play.
Rather than battling Proposition 99 in the open, the tobacco industry
would help orchestrate other interests who wanted the money. The industry would remain in
the shadows, making campaign contributions and lobbying the administration and the
Legislature out of the public eye.
Governor Wilson's Budget Cuts
The hope among health groups for a fast-track reauthorization of the
Proposition 99 anti-tobacco programs was shattered when Republican governor Pete Wilson
released his first budget on January 10, 1991. Although the Health Education Account
contained $161 million ($38 million carried over from previous years, $7 million in
interest, and $116 million in new tax revenues), the governor
appeared to accept the CMA's plan to spend just $30 million on the DHS anti-tobacco
The governor's budget represented a huge cutback for the Tobacco Control
Program. The local lead agencies (LLAs) and the media campaign were each to receive $15
million. The LLAs had previously been receiving $36 million annually, and the media
campaign, $14 million annually. The competitive grants program would be ended entirely,
after receiving over $50 million during the life of AB 75 and as much as $11 million in
1990-1991. (The Tobacco Control Section of DHS was also budgeted to receive $2 million for
state administration.) Wilson proposed cutting the California Department of Education
(CDE) to $16 million annually for local programs and state administration, down from $36
million. In total, Wilson proposed that the overall Tobacco Control Program was to receive
only 30 percent of the available Health Education Account revenues,
or only about 6 percent of tobacco tax revenues (as opposed to the 20 percent specified in
Proposition 99). He also proposed cutting the research program in half, to less than 3
percent of tobacco tax revenues (as opposed to the 5 percent specified in Proposition 99).
The major beneficiaries of the governor's cuts in the anti-tobacco
programs were a new perinatal insurance program called Access for Infants and Mothers
(AIM), which would get $90 million, $50 million of which would come from the Health
Education Account, and CHDP, which would be increased from $20 million to $43 million. AIM provides medical care to pregnant women and their young children
by subsidizing private insurance coverage. Because AIM pays a higher reimbursement rate to
providers than does MediCal (California's version of Medicaid), it is more popular with
medical providers and more expensive than MediCal.
The March 26, 1991, issue of Capital Correspondence, the ALA's
newsletter to activists, urged them to support AB 99 as it had been introduced by
Isenberg, with across-the-board reductions, which meant continued support for diverting
Health Education Account funds into CHDP. Among the writing/speaking points
was the comment that the provisions of AB 75 (now AB 99) set forth a
reasonable and fair system to improve health care and health education programs.  The strategy of the voluntaries was to move AB 99 through the
Assembly and Senate as fast as possible so the Conference Committee could work at
resolving differences among the groups and between AB 99 and the governor's budget. AB 99
passed in the Assembly Health Committee by a 12-0 vote on March 5, 1991, in the Assembly
Ways and Means Committee by a 19-0 vote on March 20, and on the Assembly floor by a 68-0
vote on March 21.
The health groups continued to ignore the original mandate for how the
Proposition 99 money was to be spent, and they abandoned any interest in framing the issue
as obeying the will of the voters. Isenberg again chaired the
legislative conference committee that was to draft new legislation. The bill to
appropriate the Proposition 99 funds was AB 99. He was joined by the other original AB 75
Conference Committee members. A conference committee is very much an insider
forum, often featuring bipartisan negotiation. When political parties engage in
collusive or bipartisan policy making, especially when both are financed
by the same special interests, the public is often excluded from the process, with no
knowledge of what is being done and no chance to influence it.
The voluntaries had thus agreed to a fast-track process that gave them limited power. By
sending the bill to a conference committee, tobacco control advocates lost the advantage
of public debate and review, their chief source of power to protect Proposition 99.
The Tobacco Industry's Strategy
Within RJ Reynolds, the governor's budget was welcomed as
the first positive news we have received relative to diverting funds from the
Proposition 99 Tobacco Education Account.  According to a
company memo, In view of Governor Wilson's action, we anticipate a funding
frenzy developing on the part of counties, health groups, and others to divert even more
of the funds. 
An RJ Reynolds strategy memo of January 29 viewed the governor's
budget as a window of opportunity and discussed what the company could do to
provide legislators with an additional reason to support the Governor's proposed
budget shift.  The company's legislative strategy was
twofold: provide the Legislature with evidence that a budget shift would be
consistent with the desires of voters and would not materially
undermine the state's overall smoking and health efforts given industry and RJR initiated
programs.  The memo reported on a company survey showing
that only 33 percent of voters believed the media campaign was effective and that 37
percent felt they learned nothing from the advertisements.
The industry also explored the feasibility of shifting anti-tobacco
education money away from the anti-smoking advertising campaign and into the schools,
which the industry considered less threatening. The RJ Reynolds memo observed,
School education and increased parental involvement are seen as the most effective
ways to discourage underage smoking ”35% and 19% respectively. While this does not
speak directly to Prop 99 advertising, it does speak to the importance of `traditional'
forms of education.  The plan was to mount a credible
campaign to demonstrate that the industry could handle the youth issue itself,
because underage smoking is widely perceived as the most critical problem and
single largest impediment to industry credibility. However, the memo concluded with
the comment that any credible attempt to address the youth smoking issue must
include a school/youth group program given public opinion on the importance of school
The Final Negotiations
By June 1991, the CMA's board of directors had endorsed a resolution
supporting the governor's proposed reallocation from the Health Education Account to AIM,
thus ending any pretense to preserve the status quo. They also supported the reallocation
of money from the Physician's Services Account to AIM because those funds
would be used for insurance programs that are likely to pay much higher
reimbursement levels to physicians than the maximum of 50% of amount billed that is
authorized under Prop 99. There are also significant surpluses being accumulated in Prop
99 Physician Service Accounts which are dedicated to paying for emergency, pediatric and
obstetrical services. 
On June 13, 1991, Senator Diane Watson wrote to the Legislative Counsel,
the Legislature's lawyer, asking whether Health Education Account monies could be used to
fund the new AIM program for expanded medical care for low-income women. The Legislative
Counsel replied that Proposition 99
specifically limits the use of the funds in the Health Education
Account for programs for the prevention and reduction of tobacco use, primarily among
children, through school and community health education programs. ¦These funds
cannot be used for purposes other than programs for the prevention and reduction of
tobacco use. A program for expanded prenatal care is not a program for the prevention
and reduction of tobacco use, through school and community health education programs,
except to the extent that the program might involve education to prevent or reduce the use
of tobacco by prospective parents. [emphasis added]
The Legislative Counsel advised that the Legislature could divert
Health Education money to medical services only by returning to the voters with a new
statute; a four-fifths vote of the Legislature would not suffice because such diversions
were not consistent with the intent of Proposition 99.
The legislative process was not disturbed by this legal opinion
pronouncing the diversions illegal, nor by subsequent opinions requested by Isenberg and
Elizabeth Hill, the Legislative Analyst. The CMA, the
Western Center for Law and Poverty, the California Nurses Association, and CAHHS wrote to
the Conference Committee on June 30, 1991, suggesting language to strengthen the rationale
for funding AIM through the Health Education Account. To make these medical programs
appear to be anti-smoking education programs, the organizations wanted to add the clause
Health Education Services, smoking prevention, and where appropriate, smoking
cessation services also shall be required. 
The voluntaries ended up supporting the diversion into AIM. The ALA
argued, as it had done with CHDP, that it would be a one-time grant of $27
million to provide tobacco related services to this population. Authorization of AIM
incorporates and specifies the services to be provided. We believe this will be a one time
allocation.  Both the ALA newsletter and an earlier
Action Alert sent from all three voluntaries emphasized that this was a legal and
With the support of some important allies, the tri-agencies developed
a counterproposal to the governor's AIM proposal. Our proposal honors the governor's
desire to provide perinatal care to low-income women, yet most importantly, presents an
alternative funding mechanism which does not inappropriately or illegally use Health
Education Account monies. Our proposal
provides a coordinated and integrated approach to a perinatal community-based program
with an anti-tobacco health education component. [emphasis in
In addition, the voluntary health agencies continued to support
funding for CHDP. The ALA newsletter summarized their position:
Our agreement also committed us to support the full caseload of
services to young children in the Child Health and Disability Program (CHDP). We have in
the past, sponsored most of this service ($20 million annually) in order to provide
anti-tobacco services and referrals to these children and their families. Our expanded
CHDP responsibilities are expected to total $35 million a year. This is an ongoing
commitment, though AB 99 required much closer auditing of the CHDP program in order to
assure that needed services are being provided.
The statement is noteworthy in its reference to CHDP as an
ongoing commitment and in its reference to CHDP funding as our expanded
CHDP responsibilities, implying an agreement that CHDP would be a Health Education
The voluntaries agreed to the diversion on June 30.
John Miller later recalled that, during the negotiations, the legislative
leadership came down on me and demanded that I give up $20 million, and I looked at the
program and figured, `What can I give up that's least harmful?' And I came up with Local
Leads because they weren't always the wonder boys we all think of them now.  The Sacramento insiders had been leery about giving money to the
local level in 1989 under AB 75 and were willing to reduce their funding now to get a
compromise. The tobacco industry would not have objected. The local programs were costing
the industry considerable time and money, and stopping the local programs had already
become an industry priority.
AB 99 Emerges
The legislature eventually adopted AB 99, which authorized
expenditures from the Health Education, Physician Services, Medical Services, and
Unallocated Accounts until 1994. The final version of the bill diverted increasing amounts
of Health Education Account money into medical services. The Legislature took $27 million
out of the Health Education Account for the AIM program, and CHDP's budget went from $20
million to $35 million a year. In an action that was to have a major impact at the local
level, the LLAs were required to spend one-third of their allocation on perinatal outreach
programs in their counties. Known as Comprehensive Perinatal Outreach (CPO), this
county-based program identifies pregnant women who should be receiving medical care and
brings them into the medical care system. The program itself does not offer any services;
it merely performs outreach activities. All three of these programs ”AIM, CHDP, and
CPO ”were supposed to have a tobacco education component. The closest any of them
came to meeting this requirement was a CHDP form with three questions about tobacco use.
The voluntaries supported using some of the LLA money for outreach to
pregnant women in exchange for the provision of anti-tobacco education.  But CPO did not provide anti-tobacco education; it took LLA money
that had been used to deliver tobacco programs and shifted it to an outreach effort (like
AIM) that would bring women into medical services. The immediate result was fewer tobacco
programs because of the redirection of LLA funds; there would be fewer still if AIM needed
more money, because AIM had protected status.
The protected status stemmed from another move that would have a major
impact on the anti-tobacco education programs. A clause known as Section 43 was added to
AB 99 to guarantee funding for five medical services programs ”MediCal Perinatal
Programs, AIM, the Major Risk Medical Insurance Program (MRMIP), CHDP, and the County
Medical Services Program. Thus, these programs were guaranteed money off the
top to fund them in the face of declining revenues; the other Proposition 99
programs were cut to support the protected ones. This provision,
combined with the overall decline in Proposition 99 revenues because of its success in
reducing tobacco consumption, promised to wipe out the anti-tobacco education programs
over a period of a few years.
Neither the voluntaries nor Miller noticed the Section 43 language when
it was added. When they were later interviewed about AB 99, Miller and Najera both
expressed bitterness about Section 43. According to Miller, The Section 43
crap ¦we all come to agreement, we divide the money up, we settle it all. The bill goes
out to print, and it's before the Legislature, it goes most of the way through the system
and Department of Finance said, `Oh, oh, one little thing more. We need to stick in this
provision to protect it or the Governor doesn't go along with this deal.' We look at it
and it says, `We need to tinker with the numbers to make it come out right. We need to
protect some programs.' Okay, do it.  Najera added,
We didn't understand what Section 43 was until
after it happened and the Department of Finance started coming after that. ¦It
just happened, it was just one thing that was thrown in there. 
The voluntaries were at a significant disadvantage in staying abreast of
important technical details like Section 43, especially compared with the medical care
groups, because of the size and depth of their lobbying staffs. Proposition 99 was
generating around $500 million a year, making the voluntary health agencies major
stakeholders, but they had not expanded their policy analysis capabilities or lobbying
presence in Sacramento since the passage of Proposition 99. The devastating long-term
effects of Section 43 emerged from policy research and analysis at UC San Francisco.
After the governor signed AB 99, ALA's newsletter announced,
We are pleased to communicate that all the Health Education Programs are in place,
functioning and authorized for three more years.  The
main virtues of AB 99 were that the sunset date was three years away, and, according to
the Los Angeles Times, the Wilson administration had promised Najera that it would
not try to divert any more funds for at least the next three years in exchange for the
deal. The ALA's optimistic statement, however, masked a
different reality. Rather than the status quo that the voluntaries expected when they
allowed AB 99 to be handled through the Conference Committee process, AB 99 represented
significant damage to Proposition 99 anti-tobacco education programs. In 1991-1992, of the
$151 million available in the Health Education Account, only about half ($78 million) was
actually going to tobacco prevention programs. The voluntary health agencies had
completely capitulated to the medical interests. In doing so, they abandoned their
strongest argument: that the Legislature had an obligation to appropriate Proposition 99
Health Education funds for anti-tobacco education efforts as directed by the voters.
Instead, they accepted the reality of insider horse-trading over the budget.
The Governor Tries to Kill the Media Campaign
Governor Wilson finally gave the tobacco industry what it wanted in
January 1992: he shut down the media campaign.
Although Wilson had included the media campaign in his 1991-1992 budget,
he imposed increasingly tight political control over it as his first year in office
unfolded. According to Ken Kizer, director of DHS, the Governor's Office immediately
wanted the advertisements toned down and
even started to review them. DHS was no longer able to
operate free of political interference in mounting its effective campaign to reduce
In his budget for the 1992-1993 fiscal year, released on January 10,
1992, Wilson went one step further and eliminated the media campaign entirely. Moreover, rather than waiting for the Legislature to act, the
governor had already ordered DHS not to sign the just-negotiated contract with the
keye/donna/perlstein advertising agency, which had been going to continue the campaign on
January 1, 1992.
The media campaign went dark.
Dr. Molly Joel Coye, whom Wilson had appointed to replace Ken Kizer as
DHS director, defended the decision to kill the media campaign.
Coye was a dramatic change from Kizer. Whereas Kizer had been a strong program advocate
and defender, Coye was not; she followed the governor's orders and remained aloof from the
tobacco control community. According to Jennie Cook, Molly was different. You
could never get an audience with Molly. She was never available. 
Coye vigorously pushed the administration line that the local programs funded by
Proposition 99 were a more effective use of resources and that the smoking decrease
following the beginning of the media campaign was actually part of a trend that began in
1987 rather than the result of the anti-smoking advertising campaign.[43-45]
In an opinion editorial in the Sacramento Bee, Coye claimed that the
revenues from Proposition 99 are being diverted for only one reason: to cope with the
worst budget crisis in California's history. ¦If the tobacco industry is pleased
with this temporary shift, it couldn't be more wrong.  In
fact, when the media campaign was suspended, the decline in tobacco consumption slowed.
While Governor Wilson justified the decision to eliminate the media
campaign by pointing to the state's fiscal crisis, no one in the public health community
believed him. Assembly Member Lloyd Connelly (D-Sacramento), the primary legislative force
behind the original Proposition 99, expressed a view that was widely held within the
public health community: During the Proposition 99 campaign and the intense
negotiations surrounding the implementation legislation, the provisions most virulently
opposed by the tobacco industry were those that created the Health Education Account,
including the enormously successful TV and radio antismoking ad campaign. Can it be just a
coincidence that ”after being wined and dined by the tobacco industry last summer
”that it is precisely that account which has been gutted? I do not think so. 
The governor was, in fact, more interested in killing the media
campaign than in weighing how the money was being spent. At a March 16 hearing on the
budget, held by the Senate Budget and Fiscal Review Subcommittee on Health, the
Legislative Analyst indicated that the proposed diversions were inappropriate uses of the
Health Education monies and that only the voters could make that reallocation. The governor then proposed to shift the money to an AIDS testing
program, perhaps hoping to enlist the AIDS lobby in the effort to kill the media campaign.
In response, the ALA claimed that the Governor's real agenda was not to fund
needed programs but to gut the media campaign in whatever way possible.  Kathy Dresslar, an aide to Assembly Member Connelly, agreed:
The fact that the governor has changed the reason why he wants to divert funds from
the media account suggests he is less interested in health priorities than he is in
gutting the media campaign. 
In any event, both the governor's action and the justification for
eliminating the media campaign effectively implemented the tobacco industry's plan, dating
from 1990, to work with a variety of minority groups, hospital groups, the CMA, and
business groups to divert money from the media program into other health programs. The tobacco industry publicly endorsed the governor's action: the
Associated Press reported that Tom Lauria of the Tobacco Institute, the
industry's lobby, applauded the proposed elimination of a campaign that `focused primarily
on ridiculing industry ¦and basically put smokers in a bad light.' 
In addition to citing the state's fiscal problems as the reason for
suspending the media campaign, the administration claimed, without presenting any
evidence, that the campaign was a waste of money because it did not work and that it was
of secondary importance.
These claims about the media campaign's lack of importance and
effectiveness were contradicted a few days later when John Pierce, a professor from the
University of California at San Diego, released preliminary data from the California
Tobacco Survey (a large statewide survey conducted under contract to DHS), of which he was
director. Speaking at the AHA Science Writers Conference, Pierce said that the survey
results demonstrated a 17 percent drop in adult smokers between 1987 (the year before
Proposition 99 passed) and 1990. In 1987, 26.8 percent of adults smoked, compared with
22.2 percent in 1990. Pierce attributed this drop to the combined effects of the tax,
educational efforts, and the media campaign. Since the
media campaign was the only part of the California Tobacco Control Program that was active
during most of this period, Pierce identified it as the primary factor in this rapid fall.
Pierce's report made headlines. The San Francisco Chronicle
proclaimed, Anti-Smoking Program Big Hit ”But Governor Seeks to Cut It.
 Other major newspapers gave the study's results
prominent coverage: California Push to Cut Smoking Seen as Success (Wall
Street Journal); Anti-Smoking Initiative Called Effective (Washington
Post); Anti-Smoking Effort Working, Study Finds (Los Angeles
Times); California Smokers Quitting (USA Today).[52-55] Rather than claiming credit for this stunning public health
success, the Wilson Administration attacked Pierce's result, claiming that the conclusions
were overstated. DHS's new spokeswoman was Betsy Hite,
who had been one of the original advocates for Proposition 99 when she was the ACS
lobbyist; now she vigorously defended eliminating the media campaign.
Hite pressured TCS staff members to falsify data about the effectiveness
of the programs in support of the administration's claim that the media campaign was not
responsible for the state's decline in tobacco consumption. Hite told Jacquolyn Duerr,
then head of the TCS media campaign, to back up Hite's assertion that the smoking decline
had nothing to do with Proposition 99. Duerr and Michael Johnson, the head of DHS's
evaluation efforts, and Pierce's contract monitor, refused to comply.
Duerr wrote Dileep Bal, the head of the DHS Cancer Control Branch (which includes TCS),
saying, I want you to know that this is some of the most unprofessional
behavior I have experienced in my state service tenure ; Johnson wrote,
I hope that something can be done very soon to stop this falsification of
The First Litigation: ALA's Lawsuit
Shutting down the media campaign was too much for the ALA to swallow.
In 1991 the ALA had been promised that, in exchange for accepting AB 99's diversion of
funds, there would be no further diversions for the life of the legislation, which would
not expire until June 1994. When asked why the agreements of previous years were not being
honored, Kassy Perry, the governor's deputy communications director, responded,
That was last year. This is this year. 
Rather than allowing the media campaign to be shut down, the ALA filed a
suit against Wilson and Coye on February 21, 1992, arguing that by refusing to sign the
contract with the advertising agency, they had violated AB 99, which said that the DHS
shall run an anti-tobacco media campaign. Significantly, ALA did not
challenge the diversion of funds on the grounds that this move violated Proposition 99
itself. Bringing such a case might have been difficult since ALA had agreed to the
Neither AHA nor ACS joined ALA in its lawsuit, although ANR attempted to
file a friend of the court brief. ACS was willing, if asked, to state privately its
position that the cuts were illegal and a flagrant violation of the will of the people,
but it refused to join in the suit. ACS thought it could achieve more working behind the
scenes. This view was surprising, since the evidence to date
had indicated that health groups won in public venues and lost behind the scenes.
Jennie Cook, ACS lobbyist Theresa Velo, and AHA lobbyist Dian Kiser met
with Bill Hauck, the governor's assistant deputy for policy, and Tom Hayes, the director
of finance, while the lawsuit was in progress. Whereas ACS and AHA wanted to talk about
the anti-smoking program generally, the administration officials seemed to care only about
the lawsuit. According to Cook, The first item on their agenda was the
lawsuit. After we explained that our two organizations were not involved, the mood
instantly changed and became much more positive.  Cook,
Velo, and Kiser attempted to discuss the merits of the program, but Hauck and Hayes wanted
to discuss budget problems. Cook continued, They expressed concern regarding
the media's interpretation that the Governor is proposing this [sic] cuts for the
tobacco industry. They asked our organizations to help clarify these erroneous statements.
 The ACS and AHA did not do so.
Hauck and Hayes apparently recommended that the ACS and AHA
representatives talk to Russ Gould, the secretary of health and welfare. They did so,
meeting with Gould and Kim BelshÃ©, the deputy secretary for program and fiscal. (In
1993 BelshÃ© would be named director of DHS, where she would be responsible for
implementing Proposition 99. In 1988 she had been a spokesperson for the tobacco
industry's No on Proposition 99 campaign.) According to Cook, We informed them
that we are not involved in the pending lawsuit, at which time their apprehensions
dissipated.  As Cook reported to the ACS leadership,
Gould explained California's fiscal dilemma and assured us that all
accounts were looked into along with the Proposition 99 accounts. The decision was made to
preserve only direct service funds (i.e., community-based programs). They felt that while
the media campaign is a worthwhile program it does not provide direct services; same for
the education and research accounts.
They went into some depth explaining the devastating cuts they have to
make and that they are uncomfortable with having to make these choices. They asked for an
opportunity to reach out to our organizations to explain the tight spot that the State is
in at this time. Gould offered to attend an ACS Board of Directors to do just that.
Finally, we requested that we keep an open channel of communication with
the Agency through one knowledgeable individual. They both indicated that Belshe would
fulfill that role; Belshe invited us to call her to discuss the issue on an on-going
In conclusion, this meeting was very productive in establishing a direct
line of communication with the Health & Welfare Agency.
Administration officials were happy to communicate with ACS and AHA.
But the communication did not lead to any policy changes.
When asked in 1998 about ACS's decision not to join the 1992 ALA
lawsuit, Cook, who was by then the national chair of the ACS board and the chair of TEOC,
said, Cancer and Heart were still a little timid to get into lawsuits. Lung
led the way and I think the fact that Lung won it with no real big problem made the other
two feel that, `maybe it's time we spoke up.' It wasn't that we didn't want to, it's just
that ”the old saying about, `we were using public funds and we felt that that's not
what the public gave us money for was to sue the governor.' Today, it's a little different
[laughter].  In 1992 ACS was unwilling to confront the
Wilson Administration in a public forum where the ACS's high public credibility gave it
strength. Cook commented that ACS's preference was to avoid confrontation, to
maneuver it, consider it, talk it out, be diplomatic. What we discovered is where
tobacco is concerned, you can't be that way. 
On April 24, 1992, the ALA won in court when Judge James Ford of
Sacramento Superior Court ruled that Wilson did not have the authority to take funds
appropriated for one purpose and use them for another; Ford ordered that the money be used
for the authorized media campaign. The big question following the ALA victory was whether
the governor would appeal the Superior Court's decision. An appeal would freeze the status
quo and keep the media campaign off the air while the case made its way through the courts
”possibly for a year or more.
Wilson had appointed Molly Coye director of health services, effective
May 29, 1991. Under California law, she could serve for up to one year before she was
confirmed by the Senate. If, however, the Senate did not confirm her by the so-called
drop-dead date, she would have to leave office. Because of unrelated controversies, the
Senate was taking up the matter of Coye's appointment as the litigation over the media
campaign was coming to a head. The AHA, which had declined to join the lawsuit, then
entered the world of hardball politics.
The AHA convinced the Senate Rules Committee to hold up Coye's
confirmation until the deadline for filing an appeal in the media case had passed. At a
tense hearing regarding Coye's confirmation, the administration lined up around fifty
witnesses to support her, including the CMA, CAHHS, and many other medical organizations.
(ALA and ACS took no position on Coye's confirmation.) In the face of this support, Kiser,
the AHA's lobbyist, attended the hearing and read a prepared statement that she and Glantz
had written, urging the Senate to delay action on Coye's confirmation.
The statement read:
Dr. Coye is responsible for overseeing the Health Education Account,
including several key components such as the media campaign, the California tobacco
survey, and various grants programs to community-based organizations.
The American Heart Association has serious reservations regarding the
way these components are being implemented.
These concerns have led the American Heart Association to seriously
consider questioning Dr. Coye's confirmation. However, we would like to suggest a positive
alternative and that would be to defer her confirmation until she has had an opportunity
to remedy the problems that have been created in the implementation of Proposition 99.
That statement went on to stipulate that Coye execute the
media contract that had been awarded, and see that the contractor can continue the
campaign free of political interference. 
At her May 6 hearing Coye pledged, I make the commitment and
the Governor makes the commitment. We do not plan to appeal the decision.  The governor did not appeal the court decision, Coye was confirmed,
the media campaign resumed, and tobacco consumption started to drop again in California.
By the end of the 1993-1994 budget period, Californians had consumed 1.6 billion fewer
packs of cigarettes (equaling $2 billion in pretax sales) than they would have if
historical pre-Proposition 99 consumption patterns had been maintained (figure 13).
The episode demonstrated once more that the anti-tobacco groups
exercised the most power in public forums outside of legislative back rooms. In contrast
to the tobacco industry and medical interests, which provide substantial campaign
contributions to politicians, the health groups get their power from public opinion and
public pressure. ALA, which had led the movement to work around the legislative process
when it developed Proposition 99, once again succeeded by going outside the Legislature,
this time to the courts. AHA solidified ALA's victory by publicly confronting the
administration over Coye's confirmation. Program advocates would eventually use the courts
again to leverage the legislative process.
Figure 13. Impact of the California Tobacco Control Program on
cigarette consumption through 1994. Passage and implementation of Proposition 99 was
associated with a rapid decline in cigarette consumption in California. During 1991, the
year that Governor Pete Wilson took the media campaign off the air and blocked many local
programs, the decline stopped. It resumed when the program started up a year later.
The 1992-1993 Budget Fight
In his budget for fiscal year 1992-1993, released in January 1992,
Wilson again ignored the deal that he had made with the health groups by diverting the $16
million allocated to the anti-tobacco media campaign into medical care.
He also proposed to eliminate the school-based anti-tobacco programs.
In the first attack on the Research Account, he ignored Proposition 99 and the
implementing legislation (SB 1613) by cutting the Research Account from 5 percent to less
than 3 percent of tobacco tax revenues. Like the other temporary shifts,
the ones proposed by the governor in 1992 were part of a continuing downward spiral in the
amount of money allocated to Proposition 99's Health Education and Research programs.
The Budget Conference Committee agreed to $80 million of the $123
million allocation for education and research that the governor proposed
to divert into medical services during fiscal years 1991-1992 and 1992-1993. The cuts
for 1992-1993 completely eliminated the $26 million for school-based programs, cut the
media campaign in half to $7 million, and reduced the research program by $12 million. The public health groups opposed these cuts.
The ALA asked its attorney, George Waters, for a formal legal opinion
regarding the diversions of Health Education and Research money into medical services. In
an extensive opinion that mirrored those offered earlier by the Legislative Counsel,
Waters advised the ALA that such diversions were illegal:
We conclude that funds in the Health Education and Research accounts
cannot be used to fund health care programs ¦ .
The drafters of Proposition 99 obviously paid a great deal of attention
to how the Tobacco Fund would be divided up. The language is very specific. The intent of
the drafters, and by extension the intention of the electorate, was to make a fixed
percentage of the Tobacco Fund available for specific purposes and specific purposes only.
This conclusion is buttressed by the Voters Pamphlet description of
Proposition 99. The Voters Pamphlet is an approved source for the determination of the
legislative intent behind a ballot measure. ¦[and] contains the following analysis
of the Legislative Analyst:
The measure requires the revenues from the additional taxes to
be spent for the following purposes:
Health Education. Twenty percent must be used for the prevention
and reduction of tobacco use, primarily among children, through school and community
health education programs.
Given the above, we are reasonably confident that we can set aside in
court any attempt to use monies in the Health Education and Research accounts for any
purposes other than health education and research. [emphasis in
The ALA chose not to sue. Instead, it made another deal.
On July 15, 1992, ten senators and twenty-seven assembly members signed
a letter to Senator Alfred Alquist (D-San Jose), the Budget Conference Committee chair,
protesting the committee's action in redirecting Health Education and Research monies to
medical service programs. According to the letter, the redirection of these funds violated
the public trust, violated the constitutionally protected statutory provisions of
Proposition 99, and would disrupt the programs wrongfully receiving the money when it had
to be returned to appropriate uses. On July 17, however, the Budget Committee reaffirmed
its decision to divert the money.
In opposing the diversions, the health groups created a procedural
problem for the forces seeking to dismantle the Health Education and Research programs.
This issue had not come up in earlier budget bills because the health groups supported the
diversions; the associated legislation, passed by lopsided majorities, had gone
unchallenged in the courts. The ALA had gone to court once ”over the media campaign
in 1992 ”and won. This time, the health groups were opposing the diversions.
On August 7, 1992, Peter Schilla of the Western Center for Law and
Poverty wrote to Assembly Speaker Willie Brown to urge him to separate the Proposition 99
diversions from the remainder of the budget on the grounds that it would be difficult to
get a four-fifths vote on the entire state budget. The budget
needed only a two-thirds vote to pass, and Schilla and others were arguing that the money
could be diverted because of the language in the initiative that permitted the Legislature
to enact amendments to Proposition 99 by a four-fifths vote, so long as the amendments
were consistent with its purposes. (Critics were arguing that any
reductions in the Health Education and Research programs below 20 percent and 5 percent
would not be consistent with the intent of the initiative.) Brown
followed Schilla's advice, removing the Proposition 99 accounts from the budget bill and
placing them in separate bills that would be easier to pass under the four-fifths
In the end, the bills did not come to a vote. The health groups agreed
to a last-minute compromise in which most funding for the media campaign, competitive
grants, and schools was restored. The LLA programs, however, took a major cut ”from
$24 million to $12 million. According to Najera, In assessing where to
amputate, the politicians had to make flash comparisons of the relative return between the
different parts of the anti-tobacco program. One strong argument on cutting local leads
was that much of the county funds were already spent on direct medical services, and thus
the loss of local funding was diminished by whatever amount went to non-tobacco services.
 From the standpoint of a county's total revenues, this
statement might have been true. But the cuts to the LLA would not be offset by money for
local medical services. Moreover, the requirement that one-third of LLA money be diverted
into the CPO medical services program remained, which amplified the effects of the LLA
cuts. The local programs would be forced to absorb large cuts just as they were hitting
The LLAs were eventually rescued because of the fallout from an
unrelated political battle between the Legislature and the governor over funding for
community colleges. It turned out that the Legislature did not
need the Health Education money to pay for medical services; they instead diverted $21
million from the Health Education Account to community colleges. The governor vetoed this
appropriation, and on October 1, 1992, the Department of Finance issued a letter returning
this money to CDE, competitive grants, and the LLAs, as specified in AB 99.
The attacks on the LLA budgets in both 1991 and 1992, along with the
1992 attack on the media campaign, were consistent with the tobacco industry's strategy to
reduce Proposition 99's effectiveness. The LLAs were costing the tobacco industry time and
money with their local ordinance work. Further, by educating minority communities about
tobacco issues and bringing them into the tobacco control network, the LLAs and the
competitive grants were weakening an industry power base.
The erosion of Proposition 99 continued.
Positioning for 1994
The continuing failure of CHDP and CPO to provide tobacco use
prevention services was becoming an increasing irritant for tobacco control advocates. CPO
was, in fact, mainly being used to get federal matching funds. At the county level, CPO
programs were supported from two sources: Proposition 99 Health Education Account money
and federal matching funds. This money had to be used exclusively for outreach; none could
be used to deliver services. Counseling services, which included smoking cessation, did
not qualify for federal matching funds. Dr. Rugmini Shah, the
director of the state-level DHS Maternal and Child Health (MCH) program, which
administered CPO, defined outreach as finding individuals who are not
accessing services and bringing them into the service area system. Cessation classes
could not be funded because the women are already in here for the classes, so
it's not outreach.  Thus, any Proposition 99 dollars that
generated federal matching dollars could not be used for tobacco-related services.
At the November 1992 TEOC meeting, the CPO program was on the agenda.
TEOC was concerned that the money was being used illegally to meet a federal match for
perinatal outreach services and that the federal rules prohibited the use of state
matching funds for any anti-tobacco activities. At the January
1993 TEOC meeting, MCH was able to tell TEOC that $7 million of the Health Education
dollars given to MCH went to the federal matching program and that only nine of the
fifty-eight counties provided cessation training components. By
the March 1993 meeting,
the dollar figure for matching had gone up to $8 million, with only $216,000 not
qualifying for matching funds. TEOC chair Carolyn Martin called this a
gigantic rip-off of the Health Education Account dollars. 
In contrast to their earlier positions, the health groups and their
representatives on TEOC were now openly challenging the appropriateness of using Health
Education funds for medical services. In submitting the 1993-1995 Master Plan for
California's Tobacco Control Program to the members of the Legislature, Cook and Martin
wrote to the legislators on behalf of the TEOC:
We are particularly alarmed by the fact that funding for the CHDP
Program continues to expand, yet we have little idea of what CHDP is doing with these
funds and no evaluation of its impact. Physicians in CHDP respond to three vague and
inexact questions related to tobacco use, second-hand smoke and counseling. The data
generated through this protocol is essentially useless. Improving the protocol, which the
California Department of Health Service has indicated its willingness to do, might help.
However, to date as far as we can ascertain, despite the large funding provided to it, the
CHDP Program has contributed nothing to tobacco control.
In addition, the one-third of the money set aside in the Local Lead
Agency grants for tobacco-related Maternal and Child Health activities is being used
for outreach, without any tobacco education component, despite the legal requirement in
Proposition 99 that funds be used only ¦for programs for the prevention and reduction of
tobacco use. [emphasis added]
Tobacco control advocates were beginning to be openly critical of the
diversions from the Health Education and Research Accounts to medical services.
Coye resigned as DHS director in September 1993. On November 9 the
governor named S. Kimberly BelshÃ© as her successor. Although BelshÃ© had been working
in the administration since 1989, she was not a physician, as both Coye and Kizer had
been. At thirty-three, she had worked primarily in public relations. More alarming to
tobacco control advocates was the role that BelshÃ© had played in 1988 as the tobacco
industry's Southern California spokeswoman against Proposition 99.
BelshÃ© defended her past association with the tobacco industry, saying that she had
opposed Proposition 99 for fiscal reasons. Her proposed
appointment did little to reassure advocates of the Health Education and Research programs
that they would receive the protection for which Kizer had fought. Her lack of medical
credentials notwithstanding, the CMA supported her appointment.
AB 99 continued in force for the 1993-1994 budget year, and the
governor's budget for 1993-1994 contained no major raids on the Health Education Account
except for those required by Section 43. Section 43, however, led to three cuts to the
anti-tobacco program during 1993-1994. Tax revenues ultimately fell by 8 percent between
1992-1993 and 1993-1994, but expenditures for anti-tobacco education fell by 31 percent. The discrepancy between the funding allocation in Proposition 99
and the actual expenditure of funds continued to widen.
While turning a blind eye to the needs of the Tobacco Control Program,
the Legislature acceded to pressure from breast cancer research advocates to increase the
tax on cigarettes by two cents a pack. The new tax funded a breast cancer research program
administered by the University of California similar to the Tobacco Related Disease
Research Program. The tobacco industry did not seriously oppose this tax. Aside from the
modest increase in price, it did nothing to reduce tobacco consumption. It did, however,
offer some political cover for Speaker Brown, Governor Wilson, and the CMA when they were
criticized for failing to implement Proposition 99 as the voters intended.
Even though Proposition 99 created a large constituency in the field
through the LLAs and local coalitions, these people and organizations were not involved in
the dealings in Sacramento throughout AB 99. The Sacramento lobbyists made only a minimal
effort to engage these new players in the legislative process, and the local activists
were preoccupied with getting the anti-tobacco program up and running. According to ANR
co-director Robin Hobart,
There was still some sort of incursions into the Health Education
Account, but they still, at that point, seemed small and not worth spending the kind of
political capital that you would have to spend to deal with it. We were busy passing
hundreds of local ordinances by that time in California and emphasized our role as helping
the local lead agencies get their coalitions in order and start working on grassroots
organizing around local ordinance campaigns. We were probably doing trainings about every
other month, especially during the first two years, sometimes multiple times in a month.
That's where a lot of our energy and emphasis was going.
But the people in the field who were implementing the Health Education
program were growing tired of the way the money was being taken away and tired of the
rules under which they were forced to operate. Meanwhile, no anti-smoking components had
been added to CHDP, CPO, or any other health service programs. Moreover, no evaluations
were conducted to test whether CHDP, CPO, and AIM had anything to do with tobacco control,
despite pressure from TEOC chair Carolyn Martin.
The Governor Kills the Research Account
In 1989 the Research Account had been authorized by separate
legislation, SB 1613, which did not expire until December 31, 1993. The governor had made
several proposals to reduce funding for tobacco-related research in his budgets, but the
Research Account did not surface in the battle over AB 99, which dealt only with the
Health Education Account and the medical services accounts. In 1992 and 1993, Wilson tried
to cut the Research Account but withdrew the proposals when it became clear that they
lacked support in the Legislature.
As SB 1613 stipulated, the University of California managed the Research
Account using a peer review process modeled on the National Institutes of Health.
Applicants from qualifying public and nonprofit institutions (not just the University of
California) submitted proposals for research projects that were judged and graded by
committees of outof-state experts. The university funded the projects in order according
to their grades.
The university chose to define tobacco-related research
broadly. As a result, most of the money went to traditional biomedical research
with little or no direct connection to tobacco. The
university's failure to concentrate more directly on tobacco angered tobacco control
advocates, who wanted a more tobacco-specific program. Some of the research was very
closely tied to tobacco, however, and became the target of attacks by the tobacco
industry, its front groups, and their allies.
In particular, Glantz had won a grant in the first year of the program
to study the tobacco industry's response to the tobacco control movement. This research
had evolved into a detailed analysis of how the tobacco industry was working to influence
the Legislature as well as how Proposition 99 was being implemented. With funding from
this grant, Glantz and his coworkers published a series of monographs detailing campaign
contributions to members of the Legislature and other politicians as well as documenting
the erosion of Proposition 99 funding for anti-tobacco education.[3-4][84-85]
The monographs highlighted the diversions of Health Education Account funds to medical
services and the long-term implications of Section 43.
These reports infuriated the tobacco industry, the Legislature, and
the CMA. The industry and its allies vigorously attacked Glantz and his work as well as
the University of California for funding the studies. They claimed that this work was
politics rather than research, despite the politics
that controlled passage of Proposition 99's implementing legislation. The reports that
regularly documented the accelerating campaign contributions to Assembly Speaker Willie
Brown particularly enraged Brown (who by 1993 had received $474,217 in campaign
contributions from the industry, more than any other state or federal legislator). At one
point Brown found himself in an elevator with the director of UCSF's Institute for Health
Policy Studies (which was located in the same San Francisco office building as Brown's
district office), and Brown demanded that something be done to silence Glantz. In a
meeting with the university's vice president for health affairs, Cornelius Hopper, Brown
again attacked Glantz. A journalist who was writing a profile of Brown observed,
One morning in a sudden burst of temper, Brown pitilessly dressed down top
executives of the University of California because a researcher at UCSF had written a
report that Brown didn't like about the political influence of tobacco companies. The
university officials had come to see him on an unrelated matter, but the Speaker used the
opportunity to launch his attack anyway. `You're going to have trouble with me on every
single appropriation!' Brown said, jabbing an index finger. `If that guy gets one more
cent of state money, you'll have trouble with me!' (emphasis in original). Hopper responded that the university believed in academic freedom
and would not interfere with Glantz's work or the peer review process.
The process of reauthorizing the Research Account proceeded without much
public controversy during 1993. There was some sparring between health advocates and
university officials in an attempt to force the university to focus more specifically on
scientific and policy issues that were directly related to tobacco, but the university
successfully opposed this effort. Before SB 1613 expired on December 31, 1993, the
Legislature had unanimously passed SB 1088 to continue the program until 1997. The
governor surprised everyone when he vetoed the bill, stating, This program
should not be extended for four years when expenditure authority for all other Proposition
99 funded programs pertaining to health and research will be reviewed during the 1994
legislative session. This program should be reviewed and re-evaluated in the context of
all Proposition 99 funded programs and activities to insure the most effective use of
those funds. 
Wilson's veto effectively shut down the research program. Many were
suspicious that Wilson's action was making good on Brown's earlier threat to punish the
university if it did not quiet Glantz. Ironically, by the time Wilson killed the Research
program, Glantz was being funded by the National Cancer Institute, not Proposition 99.
The governor's veto also meant that the funds allocated for research in
the first six months of 1994 ”$21 million ”suddenly became available for other
programs. The Research Account money was soon put into play in a manner that would make it
easier during the next legislative fight over Proposition 99 authorization to divert the
funds into medical services.
As memories of the Proposition 99 election faded, legislators could
more readily ignore public opinion and the public will unless the voluntary health
agencies and other guardians of Proposition 99 found ways to activate and use public
opinion. Instead, the groups attempted to play the insider game and were not successful.
For five years tobacco control advocates, using an insider strategy, had tried to protect
their programs against the tobacco industry, the CMA, other medical service providers, the
Western Center for Law and Poverty, and the governor. This approach of working within the
Legislature meant abandoning the health groups' most potent weapon: public opinion. In
general, the years of AB 75 and AB 99 were characterized by a series of struggles testing
the resolve of the guardian groups and by their general unwillingness to fight back.
During the period 1990-1994 the issue of money for health education and
research had increasingly been framed as a budget battle, which was damaging for the
voluntary agencies trying to maintain these programs. California's economic recession
provided a cover for those who wanted to take the money out of the Health Education
Account. When Assembly Member Richard Katz (D-Panorama City), a tobacco control advocate
in the Legislature, was asked in 1997 if this had really been a budget fight, he said
not really :
I think all along they [the administration] wanted to help big
tobacco. I think it's obvious from the last couple of years in terms of their desire to
muzzle or censor some of the advertising that Health Services had done. I think in their
desire to screw with the research that the University of California does that they have
been fronting for big tobacco. The budget issue made it convenient. In terms of the
overall budget, it's not a lot of money. ¦I don't know who came up with it, it was
a very, very clever strategy that helps big tobacco under the guise of providing indigent
In agreeing to the use of Health Education funds for medical services,
the voluntary health agencies made this problem worse for themselves. Rather than standing
for implementation of Proposition 99 as enacted by the voters, the question became whether
the diversions were too large ”hardly one that would rally public support.
The one major move outside the Capitol ”when ALA filed a lawsuit in
1992 over the media campaign funding ”did generate publicity and protection for this
program. Significantly, the lawsuit was based on the governor's refusal to implement AB 99
rather than on the broader issue of AB 99's inconsistency with Proposition 99. As parties
to the AB 99 compromise, insiders at the ALA were not yet ready to make the more
fundamental policy argument: that the governor and the Legislature had violated the
voters' mandate and acted illegally in diverting Health Education Account funds into
The environmental movement, through the Planning and Conservation League
and Gerald Meral, had been instrumental in creating Proposition 99. As part of the deal
made in 1987 when Proposition 99 was being written, the Public Resources Account was to
receive 5 percent of the Proposition 99 revenues for public lands and resources. In 1990
the environmentalists decided to increase their share of revenues by securing part of the
Unallocated Account for environmental purposes. They passed Proposition 117, which set up
protections for California mountain lions and directed that funding from this program come
from the Unallocated Account, so environmental programs began to receive more than 5
percent of tobacco tax revenues. Throughout the fights to save the Health Education and
Research programs, neither the Legislature nor the governor touched the Public Resources
money ”for medical services or anything else. The tobacco industry, after all, had no
interest in diverting money from the Public Resources Account. In March 1992 John Miller
observed, [While] health education is more central to the initiative than the
5 percent that went to the environmental stuff, the Legislature realized
they could kick the hell out of the voluntary health organizations. ¦they don't
have the political clout of the Sierra Club.  Ironically,
voluntary health organizations such as AHA, ACS, and ALA consistently rank among the most
trusted organizations in the public eye and could presumably muster political clout of
The difference between these health organizations and the environmental
groups, however, was in their willingness to confront politicians in the public arena;
once Proposition 99 passed, the voters ”the grassroots ”were not involved.
Proposition 99 had become a legislative game. As an LLA staff member and then as
co-director of ANR, Robin Hobart conceded that, especially from Tony Najera's perspective,
the ends justified the means in the early phase. She explained,
If you have to give up a little bit to get relatively decent funding,
then that was an okay deal to make. I don't know if he [Najera] was wrong about that or
not the first year ¦but there was never really an attempt at any point in time to really
seriously mount grassroots support for the reauthorization issue ”the authorization
issue and then the reauthorization issue. It always really was done inside Sacramento.
We'd send out action alerts and the local units of the Lung and Heart and Cancer would
send out Action Alerts, but it wasn't really a serious grassroots campaign. That doesn't
really equal a serious grassroots effort.
In 1989 the Legislature and the governor did not harm the Health
Education and Research programs because the election was still close enough for the will
of the voters to be felt. In subsequent years, the election would fade in the legislative
and public memory. Without other efforts to bring public attention to the Proposition 99
expenditures, the preferences of the skilled, the experienced, and the powerful in the
legislative insider game asserted themselves.
Between passage of Proposition 99 and the end of the 1993-1994 budget
period, a total of $190 million that voters had allocated to anti-tobacco education was
diverted into medical services. Despite these cuts, the anti-tobacco education program
continued to depress tobacco consumption in California. While impressive, this reduction
in tobacco consumption would likely have been even greater had there been no program
disruptions (such as suspending the media campaign) or funding diversions.
1. Department of Health Services.
Research data shows significant drop in tobacco usage since enactment of
California's tobacco education campaign . Press release, October 30, 1990.
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99: Political expenditures by the tobacco industry in California politics in 1991. San
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Association of Hospitals & Health Systems, California Medical Association, California
Planners and Consultants, California Schools Boards Association, County Supervisors
Association of California, Service Employees International Union, Western Center for Law
and Poverty. Letter to Phil Isenberg. January 7, 1991.
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January 23, 1991 .
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Research. February 5, 1996 .
13. Michael JD. Letter to Lester
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16. Michael J. Interview with
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18. Tobacco Institute (?).
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20. Skolnick A. Court orders
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99 (Isenberg) ”active support. Capitol Correspondence 1991 March 26.
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27. California Medical Association.
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Board of Trustees, July, 1991). June 14, 1991 .
28. Gregory BM. Letter to Diane E.
Watson. June 13, 1991 .
29. Gregory BM. Letter to Phil
Isenberg. June 27, 1991 .
30. Gregory BM. Letter to
Elizabeth Hill. March 10, 1992 .
31. Western Center for Law and Poverty,
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Hospitals and Health Systems. Memo to AB 99 Conference Committee staff working
group. June 30, 1991 .
32. American Lung Association.
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33. Kiser D, Muraoka S, Velo T, Najera T.
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17, 1991 .
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99: Budget related issues for resolution. June 30, 1991 .
35. Miller J, Najera T, Adams M.
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36. Weintraub D. Heat put on
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37. Warren J, Morain D. Bid to
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38. State of California, Office of the
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39. American Cancer Society. Memo to unit
executive directors from Ron Hagen. Executive notice. January 23, 1992.
40. Americans for Nonsmokers' Rights.
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42. Cook J. Interview with Edith
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43. Lucas G. Demos assail Wilson
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44. Gray T. Wilson's plan to shift
funds disguises tax hike, critics say . Sacramento Bee 1992 January 26;A3.
45. Russell S. Anti-smoking
program big hit ”but governor seeks to cut it . San Francisco Chronicle
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46. Coye MJ. A temporary diversion
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48. American Lung Association.
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51. Pierce JP. Evaluating
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52. Winslow R. California push to
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53. Matthews J. Anti-smoking
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54. Zamichow N. Anti-smoking
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55. California smokers quitting
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56. State set to scrap
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57. State study lauds anti-smoking
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59. Williams L. Officials: Wilson
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62. Skolnick A. American Heart
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63. Kiser D. Testimony to
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64. Matthews J. Smoking ads
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65. Dresslar T. Tobacco industry
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66. Najera T. Memo to Scarcnet.
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67. Russell S. Battle brewing over
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68. Waters G. Letter to Tony
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70. Schilla P. Letter to Willie
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71. Najera T. Memo to the Prop 99
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72. Hayes TW, Hordyk D. Letter to
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73. Department of Health Services.
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76. Tobacco Education Oversight Committee.
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78. Green S. Wilson taps former
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80. Skolnick A. Antitobacco
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83. Glantz SA, Bero LA.
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84. Begay ME, Glantz SA. Political
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85. Begay ME, Glantz SA. Tobacco
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88. Katz R. Interview with Edith
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89. Barinaga M. Wilson slashes
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