SACRAMENTO, Calif. -- A swell of retailers are gradually rising in opposition of a June 5 statewide referendum known as Proposition 29 that aims to raise the state excise tax by $1 on a pack of cigarettes to fund cancer research.
“There are significant concerns with how the money is earmarked in Prop. 29,” Jay McKeeman, vice president of government relations and communications for the California Independent Oil Marketers Association (CIOMA), told CSP Daily News.
“While the goals of the proposition may be laudable, we believe state funding for such purposes should be integrated into the overall needs of the state and balanced with other important priorities. This proposition does not provide for that ability; it dictates revenue use without other important considerations.”
If approved, Proposition 29, the Tobacco Tax for Cancer Research Act, would increase the state's cigarette excise tax to $1.87. The levy is expected to pump an additional $735 million yearly that would fund cancer research, smoking reduction programs and tobacco law enforcement.
However, the measure comes at a time the state is facing a $10-billion budget shortfall and an unemployment rate above the national average. Businesses fear that while they support the goals of cancer research, the referendum would hurt sales, cost jobs and further undermine the state’s fragile economy.
“California is infamous for propositions that sound appealing, that rob Peter to benefit Paul, that target a less popular minority to benefit the majority,” Tom Robinson, president of San Jose-based Robinson Oil and the Rotten Robbie c-store chain, told CSP Daily News.
“Californians seem to be more cynical about these appealing propositions, propositions that don’t help the state balance the budget or put people to work,” he added. “I think the main arguments are this will raise taxes and create another bureaucracy in a state that has too much of both.”
McKeeman said the bill itself is deeply flawed, noting, “There is no requirement that the research money must be spent in-state. Sending scarce revenues out of state should be our last priority.”
And, he continued, there is no guarantee that the funds will actually go toward the most pressing need--medical research--even as the state is cutting social services. “The revenue can be spent on buildings and bureaucracy; is that appropriate when we are having to lay off teachers?”
For previous reporting on Proposition 29, see “Related Stores” below.
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