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68 cents seems to be the meeting in the middle as lawmakers turn an eye toward the budget

Cigarette tax on agenda as legislators reconvene

The conference committee mired in negotiations over the state’s cigarette tax was supposed to convene at 1:30 the afternoon of April 28 at the Capitol.

After 70 minutes of delay, the meeting came to order. But, there wasn’t much to talk about.

The conference committee, made up of three members of each chamber, voted unanimously and immediately to send a bill to the full chambers that, if passed, would increase the state’s per-pack tax on cigarettes to 68 cents, up 50 cents from the current 18-cent levy that is the third lowest in the U.S.

After conferees voted, the audience in Capitol room 216, made up mostly of healthcare professionals and health advocacy organization officials, erupted in applause.

“This is an investment in our children and in the health of Mississippi,” said Roy Mitchell of the Mississippi Health Advocacy Program.

The House and Senate had been stuck at an impasse, with 11 cents separating the two. Senate leaders had stood their ground at 64 cents per pack. The House had done the same at 75 cents. Negotiations stalled in a separate conference meeting April 21.

“We realized that we needed to come closer together,” said Rep. Percy Watson, D-Hattiesburg, chairman of the Ways and Means Committee that sent the original bill (House Bill 364) to the floor. “I think we were headed in that direction all along.” Watson said he believed the bill would clear the House.

Injecting urgency into the negotiations was the potential for car tag costs to rise. The fund the Legislature uses to reimburse counties for car tag expenses is empty, meaning folks buying tags would have to make up the difference. Under the bill agreed upon by the conference committee, revenue from a cigarette tax increase would replenish the car tag fund.

“That became a major aspect of final considerations,” Watson said.

Sen. Dean Kirby, R-Pearl, chairs the Finance Committee – the Senate’s version of Ways and Means – said in the April 21 negotiating session that any tax above 64 cents would have very little chance of clearing the full Senate.

Kirby said Tuesday that six senators who originally opposed anything over 64 cents had agreed to vote in favor of the 68-cent tax in the last seven days.

“We made some calls, talked to several senators and we feel like we have the votes to pass 68,” Kirby said after the meeting adjourned. “To be honest with you, I’m not sure I could have passed 69. I feel very comfortable that I could not have passed 70.”

The bill still has to clear both chambers — legislators reconvene the 2009 regular session Wednesday — and earn Gov. Haley Barbour’s signature.

Barbour spokesman Dan Turner said last week that the final figure was not as important to Barbour as the revenue estimate attached to it. “He also is concerned that (lawmakers) don’t spend more than it generates,” Turner said. “It sounds like they have satisfied most of his major concerns.”

Lawmakers will re-start the 2009 session at 1 p.m. Wednesday, after adjourning so the full effect of the American Recovery and Reinvestment Act on the state’s budget. Mississippi will eventually receive about $2.8 billion from the stimulus package to fund a litany of things, including road and bridge repairs, education and Medicaid, which are among the most expensive items the state has to pay for annually.

Contact MBJ staff writer Clay Chandler at clay.chandler@msbusiness.com .

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