States Learn How to Spend the Tobacco Settlement Windfall
In 1999, the National Governor's Association, Center for Best Practices, Washington, convened a conference to brief state governors and policy advisers on the landmark settlement of a suit by the states against the tobacco industry.
According to the settlement, reached in November 1998, the five major tobacco companies will provide $206 billion over 25 years to compensate states for their health care costs associated with smoking. Parties to the lawsuit and settlement included 46 states, five commonwealths and territories, and the District of Columbia.
- The conference, entitled "The National Tobacco Settlement: Making the Money Count," took place in Pittsburgh, Pa, on September 15, 1999, three months before most states were scheduled to receive their initial payments under the settlement.
Some 70 people attended, representing 31 states. While the National Governor's Association sponsored the event, other organizations helped set the conference agenda, including the National Association of Attorneys General, the Campaign for Tobacco-Free Kids, and the American Legacy Foundation, which was created under the settlement to study and develop methods for reducing tobacco use among young people.
The American Legacy Foundation also helped support the travel of state representatives.
During six plenary presentations and one plenary panel, conference attendees reviewed such topics as:
- An overview of the tobacco settlement
- The role of the American Legacy Foundation
- Best practices in state tobacco control programs
- Principles for spending settlement revenues
- Measuring the effectiveness of smoking prevention and abatement programs
- The future of tobacco companies
- The conference sponsor produced an issue brief on the spending of tobacco settlement revenues and a fact sheet on securitization a method by which states could receive an upfront lump-sum payment instead of their 25-year settlement payout. (See the Bibliography for details.)
The Campaign for Tobacco-Free Kids provided state-specific notebooks for each delegation. The Office on Smoking and Health of the Centers for Disease Control and Prevention (CDC) provided participants with copies of its publication Best Practices for Comprehensive Tobacco Control Programs.
- The National Governor's Association created a Web page on the settlement (no longer available). The association sent copies of the CDC's Best Practices publication to every governor. Governors also received memorandums briefing them on:
- Initial fund disbursement and the settlement's independent auditor process.
- The launch of the American Legacy Fund education campaign.
- Seven states participated in a conference call hosted by the governor's association for governors' policy staffs on securitization. Eleven states requested and received technical assistance on such topics as the impact of the gray market in tobacco sales, smokeless tobacco, and programs targeting minority youth.
Under a cooperative agreement with the CDC, the NGA Center for Best Practices will continue to update its tobacco Web page and provide other information and technical assistance for states on the settlement.
The Robert Wood Johnson Foundation (RWJF) provided a grant of $29,879 between September 1999 and February 2000 to support the project.
GRANT DETAILS & CONTACT INFORMATION
Conference for Governors and Their Policy Advisors on the National Tobacco Settlement
National Governors' Association Center for Best Practices (Washington, DC)
Dates: September 1999 to February 2000
Joan Henneberry, M.S.
(Current as of date of this report; as provided by grantee organization; not verified by RWJF; items not available from RWJF.)
Baskey N. 1999 State Initiatives on Spending Tobacco Settlement Revenues. Washington, D.C.: National Governors Association, 2000. Also available online.
Brochures and Fact Sheets
"Facts to Know about Securitizing Tobacco Settlement Funds." National Governors Association, January 2000.
"The National Tobacco Settlement: Making the Money Count," September 15, 1999, Pittsburgh, Pa. Seventy people attended representing 31 states. Attendees included Gov. Tom Ridge of Pennsylvania, policy directors, health policy advisers, cabinet secretaries for health, general counsel, directors of budget and planning, and tobacco prevention and control advisers.
- Gov. Tom Ridge (Pa.), "Five Principles for Spending Tobacco Settlement Revenues."
- Mary Schlaefer, National Association of Attorneys General, "An Overview of the Master Settlement Agreement."
- Chuck Wolf, American Legacy Foundation (untitled).
- Laurie Loveland; Ness, Motley, Loadhold, Richardson, and Poole, "Economics 101."
- Laurie Loveland and Marcia Howard, Federal Funds Information for States, "The Economics of It All."
- Dr. Michael Eriksen and Danny McGoldrick, Campaign for Tobacco-Free Kids, "Smoking Prevention Programs: Measuring Their Impact and Ensuring their Success."
- "Best Practices in State Tobacco Control Programs," Chuck Wolf (moderator), executive vice president, American Legacy Foundation (Washington, D.C.); Dr. Michael Eriksen, director, Office on Smoking, Centers for Disease Control (Washington, D.C.); April Roesler, chief of local programs unit, Tobacco Control Program (Calif.); Mae Waters, chief of youth and local programs (Fla.), and Paul Jacobson, deputy commissioner of Health (Mass.).
Report prepared by: Steve Marchetti
Reviewed by: Robert Narus
Reviewed by: Richard Camer
Program Officer: C. Tracy Orleans