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Governor vows to find health coverage for kids

PORTLAND — After a campaign marked by record amounts of tobacco industry money pouring into TV advertising, a cigarette tax increase to pay for children's health care was soundly defeated by Oregon voters in Tuesday's special election.

With 67 percent of the expected vote counted, Measure 50 was being rejected by a margin of 60 percent to 40 percent. Among Oregon's 36 counties, the cigarette tax passed only in populous Multnomah County, but was crushed in other places, particularly rural counties.

In Jackson County, 19,516 people or about 35 percent voted for it and 35,075 or about 65 percent were against it, according to figures released Tuesday night.

It was a stinging defeat for backers of the "Healthy Kids" plan.

They had spent the campaign's final days going door to door, pleading with voters to ignore the cigarette makers' $12 million ad blitz and approve the increase to extend health coverage to 100,000 uninsured children.

Gov. Ted Kulongoski, a leading backer of the plan, said he still thinks most Oregonians support an expansion of children's health care but were heavily influenced by the cigarette makers' record-shattering advertising blitz.

"What happened was, the tobacco industry bought the election," Kulongoski said in an interview Tuesday night with The Associated Press.

The Democratic governor declared that "this fight isn't over," and said he and legislative leaders would be looking at other ways to get more children covered.

The tobacco industry's ad campaign focused on what it called the ill-advised move of enshrining the tobacco tax in Oregon's constitution, while other ads questioned whether all of the money would go to provide health care for children.

House Democrats reluctantly placed the cigarette tax on the ballot as a constitutional amendment because of House Republicans' refusal to provide the votes needed to pass the tax outright or place it before voters as a statute.

A spokesman for the tobacco-funded opposition campaign, J.L. Wilson, took exception to Kulongoski's characterization of the industry "buying" the election.

"He's basically saying the voters were too stupid to see past the ads," Wilson said. "Voters were saying that they didn't want to pick on a convenient minority — smokers — to pay for such a program or to put the tax in the constitution."

Under the proposal, the state tax on a pack of cigarettes would have risen by 84.5 cents a pack to $2.02 per pack. That would have been one of the highest rates in the nation, behind only those of Rhode Island and New Jersey.

The tax increase would have raised about $150 million in its first year and a half, state budget officials estimated, which would have been enough to eventually insure about 100,000 children who have no current coverage.

About half of those children are from families who make more than twice the federal poverty limit — about $41,000 a year for a family of four — but who don't get health care at work and can't independently afford the cost of private insurance.

Oregon families who make $41,000 to $62,000 a year would have been able to pay on a sliding scale for subsidized care.

Health insurers, hospitals and groups such as the American Cancer Society kicked in substantial donations to the pro-Measure 50 campaign to run ads focusing on the state's uninsured children, along with their families, with stories of debt and heartbreak.

House Speaker Jeff Merkley said he and other Democrats aren't going to give up on expanding children's health care. But he said the Legislature's February 2008 session might be soon to talk about it — especially since it will still be the same cast of Republicans serving in the chamber.

"It will probably be back on the table in the January 2009 session," the Portland Democrat said.