Cigarette tax still needed

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children could be cut without

an increase in cigarette taxes.

It's undeniably good news that the federal government will send South Carolina $265.6 million over the next two years to help our state balance its budget. The money is South Carolina's share of $20 billion destined for the states to help them cope with their biggest budget crises in 50 years.

But the federal bailout will only go so far. Large funding shortfalls still will exist in Medicaid, public education, prisons, public safety and other crucial state services. A cigarette tax hike is needed to shore up health care for South Carolina's elderly, disabled and children from low-income families.

A cigarette tax hike also may free up state money that could be used to close funding gaps in education, prisons and other basic state needs. In addition, the cigarette tax is a stable and recurring funding source, unlike the one-time contribution from the federal government.

Without a cigarette tax increase, thousands of poorer South Carolinians could eventually be denied health care coverage. Some of the programs that could be reduced include the SilverCard drug program for seniors, basic health care for 43,000 children, nursing home care, mental health services and assistance for blind and disabled residents. South Carolinians who lack Medicaid health care often seek help in expensive emergency rooms, which pass on their costs to the general public, resulting in higher private insurance premiums.

As Gov. Sanford has said, the special federal allocation won't solve the state's Medicaid problem because the money is available only for two years and can't be used to bring in federal matching funds. Every dollar of state money for Medicaid, however, is matched by $3 from the federal government.

The state Medicaid program faces a $200 million shortfall. Partisan bickering should be set aside in the interest of fully funding Medicaid. Democrats appear willing to approve a cigarette tax increase by itself while Republicans want the tax increase tied to Gov. Sanford's plan to reduce income taxes in 2006.

Of the two plans, a cigarette tax hike by itself is preferable. That tax increase has been discussed for two years and has earned the support of both health care groups and the general public. It's true, however, that Sanford's plan may be the more politically viable option, and Democrats shouldn't oppose it merely to deny the governor a victory. In the end, it matters little which cigarette tax plan earns approval — as long as it is approved.

The federal government's unexpected infusion of money is welcome relief for the state budget. But state lawmakers cannot always rely on the largess of the federal government: The Legislature has the ultimate responsibility to solve South Carolina's problems.