MONTGOMERY, Ala. - Attorney General Luther Strange today announced a
multi-state agreement with the major tobacco companies that settles a
10-year dispute regarding payments under the 1998 Master Settlement
Agreement (MSA). Today's agreement ensures the stability of continued
payments in the future.
"This settlement is important for
Alabama and essential to the future of our public health funding from
the Alabama 21st Century Fund," said Strange. "The Legislature has
utilized the state's MSA funds by funding incentives for economic
development and supporting health care programs for children and
seniors. Our office is focused on maintaining the integrity of that
fund. Under the terms of the settlement, we avoid the significant
uncertainty of costly litigation and the potential loss of one or more
entire annual MSA payments."
In 1998, the major tobacco
companies agreed to pay states more than $200 billion over 25 years to
settle lawsuits over the health care costs related to smoking. For the
past ten years, there has been a dispute between the tobacco companies
and the states over portions of the payments.
Since 2003,
Alabama has received nearly $1 billion from the MSA. For each of those
years, no less than $14 million in payments would be at risk by
continued arbitration.
On December 17, 2012, the settlement was
agreed upon by 17 states including Alabama, Arizona, Arkansas,
California, Georgia, Kansas, Louisiana, Michigan, Nebraska, Nevada, New
Hampshire, New Jersey, North Carolina, Tennessee, Virginia, West
Virginia and Wyoming. The states were joined by the District of Columbia
and Puerto Rico.
