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    Pennsylvania Penalized

    Federal government fines state $6.3 million for tobacco sales to minors.

    PITTSBURGH -- The State of Pennsylvania has been fined $6.3 million by the federal government because too many stores are selling tobacco products to minors.

    Under a federal law designed to stop youth smoking, the penalty could have cost Pennsylvania $23.2 million in federal grants. Instead, the state is being allowed to spend $6.3 million more than it intended this year on tobacco education and enforcement. The money will come from the state's tobacco settlement funds, according to the Pittsburgh Post-Gazette.

    Some $5.8 million will be spent on education, the bulk of it for a series of television, radio and newspaper ads aimed at encouraging retailers to stop selling tobacco to underage customers.

    The remaining $500,000 will strengthen what has been criticized as weak enforcement efforts, the report said.

    Pennsylvania's fine is based on the 1999 survey results, which found 41 percent of stores selling tobacco to minors; that year's goal under the federal law was 30 percent.

    The U.S. Department of Health and Human Services could have yanked $23.2 million of Pennsylvania's $58 million block grant. But in its 2001 appropriations bill, Congress allowed states a one-time chance to avoid the penalty by increasing the tobacco enforcement and education budget, the report said.

    Pennsylvania was fined for failing to comply with sales quotas established under a 1992 federal law that requires states to reduce tobacco sales to children every year. The law gave states until this year to reduce the number of stores selling tobacco to children to 20 percent.

    States must conduct annual undercover compliance surveys on 10 percent of their tobacco retailers. If quotas are not met, the federal government may withhold 40 percent of a state's federal Drug, Alcohol and Mental Health Block grants, which fund community programs.

    Pennsylvania missed its mark by 11 percentage points, so its fine of $6.3 million is 11 percent of its $58 million block grant. The federal government negotiated an agreement with the governor's office between May and July 2001 on how the money was to be spent.

    In 2000, the state's noncompliance rate was supposed to be 29 percent, and came in at 26.7 percent. In 2001, the goal was 25 percent, but the state came in at 27.9 percent, which narrowly met an allowed three-point spread.

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