Report 2019-046 Recommendation 14 Responses

Report 2019-046: Proposition 56 Tobacco Tax: State Agencies' Weak Administration Reduced Revenue by Millions of Dollars and Led to the Improper Use and Inadequate Disclosure of Funds (Release Date: January 2021)

Recommendation #14 To: Justice, Department of

To ensure that it awards Proposition 56 funding in accordance with the requirements in state law, Justice should implement a formal grant application review process by June 2021 that ensures that it does not award Proposition 56 funds for purposes—such as education and outreach—that are not described in the law governing its use of funds.

Annual Follow-Up Agency Response From February 2023

As previously reported, our position remains that because education and outreach regarding tobacco laws can be a permissible component of a tobacco law enforcement program, DOJ will continue to make tobacco grant funds available for these purposes. Further, California Code of Regulations, title 11, section 521 makes law enforcement programs eligible for grant funds if they support law enforcement's efforts to prevent or reduce illegal sales or marketing to minors, including through "community outreach and education activities."

California State Auditor's Assessment of Annual Follow-Up Status: Resolved

Justice's newly filed regulations add community outreach and education activities as programs eligible to receive Proposition 56 funding through Justice's Tobacco Grant Program; therefore, we consider this recommendation resolved through this recent change to the regulations.

1-Year Agency Response

As previously reported, our position remains that because education and outreach regarding tobacco laws can be a permissible component of a tobacco law enforcement program, DOJ will continue to make tobacco grant funds available for these purposes.

California State Auditor's Assessment of 1-Year Status: Will Not Implement

Justice's position remains at odds with the direction of the law as passed by voters. As the report describes on page 20, the law requires Justice to award Proposition 56 funding to law enforcement agencies to support and hire front-line law enforcement peace officers to reduce the illegal sales of tobacco products, particularly illegal sales to minors. The activities described in the law include enforcing tobacco-related laws, increasing investigative activities, and reducing illegal sales. Rather than meeting these requirements, Justice continues to fund tobacco cessation and education programs in schools that are potentially duplicative of the funding allocated in law to the Department of Education for school programs to prevent and reduce the use of nicotine products by young people. Thus, Justice's process for awarding grants does not ensure that they are awarded exclusively for the requirements established in law.

6-Month Agency Response

Our positon remains what we have previously reported; because education and outreach regarding tobacco laws can be a permissible component of a tobacco law enforcement program, DOJ will to continue to make tobacco grant funds available for these purposes.

California State Auditor's Assessment of 6-Month Status: Will Not Implement

Justice's position is at odds with the direction of the law as passed by voters. As the report describes on page 20, the law requires Justice to award Proposition 56 funding to law enforcement agencies to support and hire front-line law enforcement peace officers to reduce the illegal sales of tobacco products, particularly illegal sales to minors. The activities described in the law include enforcing tobacco-related laws, increasing investigative activities, and reducing illegal sales. Rather than meeting these requirements, Justice continues to fund tobacco cessation and education programs in schools that are potentially duplicative of the funding allocated in law to the Department of Education for school programs to prevent and reduce the use of nicotine products by young people. Thus, Justice's process for awarding grants does not ensure that they are awarded exclusively for the requirements established in law.

60-Day Agency Response

Because education and outreach regarding tobacco laws can be a permissible component of a tobacco law enforcement program, DOJ intends to continue to make tobacco grants for these purposes. As previously mentioned, these efforts by law enforcement agencies can help prevent illegal tobacco sales to minors in much the same way that compliance checks of retailers can help prevent such sales.

DOJ established process consistently affords the following:

- Thoughtful selection of a team of committee members who participate in scheduled formal meetings to review and score the grant applications.

- Use of scoring checklists, rubrics, benchmarks, budget worksheets and checklists by the committee for the review and approval of applications, awards, and eligible activities.

- Announcement of grants to all local law enforcement agencies.

- Assignment of grant administrators consisting of DOJ's legal and other professionals to each awarded agency for assistance with implementation, oversight and lawful expenditures at the onset of the award notification.

- Frequent phone and email communications, and site visits between grant administrators and the awarded agency to provide guidance on expenditures and implementation of their specific grant program.

- A continuous informal review processes throughout each grant life cycle.

Several of these processes (e.g., committee selection, committee review, award announcements, and site visits) are currently documented in the Tobacco Grant Handbook and/or RFP document. Specifics regarding Grant Administrator assignment, communications with grantees and continuous review throughout the grant life cycle will be incorporated in the next version of the Tobacco Grant Handbook which is anticipated to be published with the next RFP within the next 30 days.

California State Auditor's Assessment of 60-Day Status: Will Not Implement

Justice's response is misleading. Its comparison of compliance checks of retailers to the grants it awards infers that it is funding the education of retailers. In fact, it is funding tobacco cessation and education programs in schools. As the report states on page 22, Proposition 56 allocates funding to the Department of Education for school programs to prevent and reduce the use of nicotine products by young people. Further, as the report describes on page 20, the law requires Justice to award Proposition 56 funding to law enforcement agencies to support and hire front-line law enforcement peace officers to reduce the illegal sales of tobacco products, particularly illegal sales to minors. The activities described in the law include enforcing tobacco-related laws, increasing investigative activities, and reducing illegal sales. Thus, Justice's process for awarding grants does not ensure that they are awarded exclusively for the requirements established in law.

All Recommendations in 2019-046

Agency responses received are posted verbatim.