Indiana's top anti-tobacco agency has reached its 10th birthday with much to celebrate: Fewer people are smoking, more communities and employers are going smoke-free and the agency has earned a national reputation for results.

But Indiana Tobacco Prevention and Cessation officials acknowledge they still have work to do in a state that in 2008 had the nation's highest smoking rate and still has more than 1 million smokers whose tobacco use costs Medicaid nearly $500 million each year and leads to nearly 10,000 Indiana deaths.

ITPC, created in 2001 with some of the $4.5 billion Indiana received from the tobacco industry's 1998 settlement with state attorneys general, won praise early on from the federal Centers for Disease Control and Prevention for being among the few state agencies that had the minimum amount of funding the CDC said was needed to effectively fight tobacco use. That funding, as high as $32.8 million in 2003, fell to $10.8 million just a year later. It remains at that level.

Rep. Peggy Welch, D-Bloomington and a member of the State Budget Committee, said ITPC receives less state money because the millions of dollars of additional funding it formerly received were "low hanging fruit" when budget writers were looking for programs to cut.

"We have a hard time in this state investing money now for its long-term gains," Welch said. "It's going to save us money in the long run, but we're not willing to make that investment now."

Karla Sneegas, ITPC's executive director since its inception, said the agency built a statewide "infrastructure" for tobacco prevention and cessation in its early years and is able now to make "longer sustaining changes that don't require as much in terms of per-capita funding."

Building that infrastructure began with getting Indiana's schools to go smoke-free, said Sneegas, a former teacher in Huntingburg. Now 70 percent of Indiana school campuses are smoke-free, compared with 28 percent a decade ago. More than 2,000 community organizations statewide are working to curb tobacco use, and ITPC says per-capita cigarette use has declined by 40 percent over 10 years.

And though lawmakers have resisted calls for a statewide ban on smoking in public places, more than 30 communities — including Fort Wayne, Bloomington and Elkhart — have passed smoke-free air ordinances, and more than 300 employers have gone smoke-free network in just the past year.

Welch wrote a letter for an ITPC time capsule that will be opened in 10 years in which she said she hoped Indiana would be a true clean air state in 2021 and that she as a cancer nurse would need to worry about her job security.

The time capsule filled with letters, tobacco products, anti-tobacco ads and other mementoes will be housed at the Ruth Lilly Health Education Center, which serves 125,000 students each year, many for courses teaching the effects of tobacco use and other health topics.

Julian Peebles, the center's president, said government agencies receive a lot of criticism these days, but ITPC is an exception.

"Indiana Tobacco Prevention and Cessation is a government agency that works," Peebles said.

Sneegas said ITPC's goals for the next 10 years include eradicating smoking among all pregnant women — about one in five still do — and making nearly all homes and workplaces in Indiana smoke free.

To do so, her group will need to win over people like Steve Stailey of Indianapolis, who smoked a cigarette as he walked his bike toward a bus stop outside the Statehouse Thursday. He said he's smoked for 25 years.

"I have no desire to quit," Stailey said, noting he takes narcotic painkillers every day for a bad back, "and that's probably hard on my liver. ... I'm already 51, you know, so I think I'm going to make it."

Other smokers feel differently. Sneegas said she stopped recently at a grocery store in the southern Indiana town of Orleans, only to overhear a middle-aged man in front of her ask for a pack of cigarettes. She said he told the clerk, "I really don't want to buy these. I try to quit, but I got into the weekend and I'm so stressed out, and I just can't make it, I've got to have a pack of cigarettes."

Sneegas introduced herself and gave him a piece of paper on which she had written 1-800-QuitNow (1-800-784-8669), the state's helpline for tobacco users who want to break the habit.

"We have to continue to help those who need to quit," she said.