Tobacco companies pay Iowa $71 million settlement installment

DES MOINES - Iowa has collected more than $960 million in settlement funds to cover tobacco-related health costs since it participated in the landmark 1998 agreement with the nation's major tobacco companies, state officials said Friday.

Tobacco companies involved in the settlement with states - the largest settlement in U.S. history - transferred more than $71 million this week in their annual payment to Iowa, according to the state Attorney General's Office.

The sum included the regular yearly payment of more than $54 million as part of the master agreement and an additional 'Strategic Contribution Fund” payment of more than $17.5 million. The payment also included a $6 million tobacco arbitration judgment from a case in which cigarette manufacturers claimed Iowa did not diligently enforce its tobacco statutes in 2003 as required under the settlement, but a unanimous three-judge panel sided with Iowa in September.

'Our office carefully monitors and aggressively enforces this agreement so Iowa gets its fair share of the settlement,” Iowa Attorney General Tom Miller said in a statement. 'We continue to hold tobacco companies accountable under the agreement, and we continue to fight the public health battle.”

In 1998, Miller and attorneys general of 45 states signed the master agreement with the nation's four largest tobacco companies to settle state lawsuits to recover billions of dollars in state health care costs associated with treating smoking-related illnesses. Since then, more than 40 other tobacco companies have signed on to the agreement.

In all, Iowa has received $960.3 million in regular and additional payments since 1999.

The agreement called for tobacco companies to pay the 46 states $206 billion over 25 years and continue annual payments beyond 25 years based on the number of cigarettes sold in the United States.

It also created a broad array of restrictions on the advertising, marketing and promotion of cigarettes, including prohibitions on outdoor advertising of cigarettes and the advertising of cigarettes in public transit facilities.

According to the Attorney General's Office, the central purpose of the settlement was to reduce smoking, especially among young people. U.S. cigarette sales have fallen substantially and youth smoking has declined, but tobacco remains the nation's No. 1 cause of preventable death.

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