Jump to full article: Lewiston (ME) Sun Journal, 2009-08-01
Author: David Farmer,Staff Writer
Intro: A ruling favoring the country's largest tobacco companies has put in doubt almost $9 million due Maine later this month.
In 1998, in exchange for annual payments of about $6.5 billion, 46 states agreed not to sue cigarette makers for the public health harm caused by their products.
Since 1999, Maine has received about $448 million from the settlement and should receive about $50 million this year. An arbiter's finding on March 28 puts at risk about $8.8 million of that amount, which could create a legal and budgetary mess for the state next year.
The independent arbiter agreed with tobacco companies that the terms of the Master Settlement Agreement caused them to lose market share in the United States. Under the terms of the deal, the tobacco companies can make their case that the $6.5 billion they owe states on April 17 should be reduced by about $1.2 billion.
Before the companies can reduce this year's payment, they have to show on a state-by-state basis that the terms of the settlement haven't been met by the states. . . .
"It could be bad news," Kelly said. "If there's no resolution found to the potential shortfall, it could be devastating to The Fund for a Healthy Maine programs."
Maine consistently wins accolades for its anti-smoking efforts and the use of tobacco settlement money. Since 1997, the state has reduced the number of youth smokers by 50 percent and in January the American Lung Association reported that Maine is the first and only state to receive perfect grades on its State of Tobacco Control Report Card.
"Maine does great things with the money," Dow said. "We're a national leader in how the tobacco funds are allocated."
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