The Legislative Interim Committee on Revenue voted Monday to ask for legislation that would put some tobacco tax money into children’s mental health programs.
Committee Chair Sen. Dina Neal, D-North Las Vegas, proposed the legislation saying federal American Rescue Plan money won’t be around forever and she had been looking for a reasonably stable revenue stream to replace some of it to continue providing child mental health services, including mobile crisis teams.
She said she is looking at using some of the Other Tobacco Products excise tax revenue. The state has had a 30 percent tax on Other Tobacco Products sales since the 1990s, that it’s stable and growing and that some of the money could be directed to the state Health Division to support these programs. The excise tax is imposed on all non-cigarette tobacco and nicotine products.
The revenue from the OTP excise tax was stable but flat for years until it was expanded to include new tobacco and nicotine products such as synthetic nicotine, vaping and alternative nicotine products three sessions ago. Legislative economist Russell Guindon said the revenue has grown significantly since then, generating $23.2 million in fiscal 2020 and projected to bring in $35 million in fiscal 2022.
The revenue currently goes to the General Fund but Neal’s proposal would claim $1.6 million for mental health programs this coming year. Her plan would increase that amount by 2 percent or the five-year average of the Consumer Price Index, whichever is higher, every year thereafter. She said that would enable health officials to expand and continue to provide mental health services for children.
Neal said she doesn’t want to specify which child mental health programs the money would go to, instead leaving that to the experts at Health and Human Services.
The vote to support drafting legislation to implement the plan was approved unanimously by the interim committee.
