The mammoth of all multistate settlements, reached long before Thursday’s announced settlement on mortgage fraud, was the Tobacco Master Settlement of 1998.
All the states and territories signed on to the settlement with tobacco companies, which promised $206 billion to be split up over 25 years.
Colorado received its first payment in 1999. The amounts have dwindled steadily, in part because of the overall slowing sales of tobacco that generate the money. Colorado expects to receive $89.2 million from the tobacco settlement this fiscal year, down from $94.6 million in 2009-10.
The money is distributed in large and small chunks to various state programs and has often been a sandbox for different legislative priorities to play out. Tobacco-law proponents have argued the bulk of the money should go to smoking-cessation and treatment programs, but in tough economic times, the big payments were just too much for strapped budget planners to ignore.
This year, the largest portions of the money go to the children’s health plan, for insurance subsidies, at $24.1 million. Another large amount, $12.7 million, goes to a state public-health program sending nursing assistance to the homes of new mothers, to improve parenting and save health costs down the road. Another $13.9 million goes to the University of Colorado Denver health campus.
In a sign of how quickly new pots of money get claimed by interest groups, the Campaign for Tobacco-Free Kids estimates that less than 2 percent of this year’s $25.6 billion in national tobacco settlement money is going toward smoking cessation and prevention.
