Vice Squad
Sunday, March 27, 2005
How Big Tobacco's Partners Spend Their Billions

The partners, of course, are the US states, 46 of whom became particularly beholden to Big Tobacco through the 1998 Master Settlement Agreement (MSA). The Government Accountability Office (GAO) issues an annual report on how the states are spending their settlement funds; the most recent report was issued last week. From the abstract:
States reported they received about $9.7 billion in fiscal year 2004 and expect to receive about $5.4 billion in fiscal year 2005....The MSA allows states to use their tobacco settlement payments for any purpose. States reported that they used the largest portions of the fiscal year 2004 payments to address budget shortfalls (about 44 percent) and to fund health-related programs (20 percent). Compared with fiscal year 2004, states in fiscal year 2005 expect to decrease allocations to address budget shortfalls (11 percent) and to increase allocations to both health-related programs (32 percent) and debt service on securitized funds (23 percent).
The Campaign For Tobacco Free Kids has been a vocal critic of how little state spending from the settlement funds has gone to fight tobacco-related health problems.

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