DOJ: News Release

McGrath: State Receives Tobacco Settlement Payment

HELENA – Attorney General Mike McGrath said Wednesday that the state has received $21.9 million, the latest payment of the 1998 tobacco settlement. The payment was the eighth Montana has received over the past four years, bringing the total compensation to the state to $91.53 million.

“Although it’s gratifying to receive settlement payments, it’s unfortunate that more of these funds won’t help the Montanans who need them most,” McGrath said. “Tobacco-use prevention and public health were the goals of the litigation.

“The plan crafted by the Governor’s Advisory Council on Tobacco Use Prevention aimed to keep Montana kids off tobacco while helping tobacco users find ways to quit,” McGrath said. “The state’s failure to adequately fund the council’s program will end up costing taxpayers more for health care costs of tobacco-related illness.”

Forty percent of the payment, or $8.76 million, will be deposited in the tobacco trust fund approved by Montana voters in November 2000. The remaining $13.14 million goes to the general fund.

Under the negotiated settlement, the major tobacco companies agreed to pay $206 billion to the states, as well as abide by a number of restrictions on advertising and sales. Montana was slated to receive $920 million through the year 2025. However, the settlement contains a clause allowing tobacco industry payments to decrease if the number of cigarettes sold decreases. Cigarette sales declined over the past year, so the payments for the year 2001 are approximately 8 percent less than original estimates.

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