DES MOINES — Iowa’s share of a 1998 landmark tobacco settlement now tops $1.1 billion.
Iowa Attorney General Tom Miller announced Friday that tobacco companies involved in the settlement with states over tobacco-related health care-costs transferred more than $65 million to the state treasury this month in their annual payment to Iowa.
The tobacco companies remitted a regular annual Master Settlement Agreement (MSA) payment to Iowa of nearly $48 million and an additional “Strategic Contribution Fund” payment of more than $17.8 million for a total payment of more than $65.8 million, according to Miller’s office.
Since 2008, Iowa has received additional annual “Strategic Contribution Fund” payments, Miller said, because of the roles he and his staff played in negotiating and reaching the 1998 MSA with tobacco companies. Those additional payments to Iowa have totaled more than $186 million, according to a news release issued by the state Attorney General’s office.
Since 1999, when tobacco companies sent their first MSA payments to the states, Iowa has received more than $1.1 billion in both regular and additional payments, he said.
“Our office puts significant time and effort into ensuring that Big Tobacco pays Iowa its fair share through annual MSA payments,” Miller said in a statement. “We are pleased to see the results through this year’s payment, particularly in light of the state’s difficult budget situation.”
In 1998, Miller and attorneys general of 45 states signed the master settlement agreement with the nation’s four largest tobacco companies to settle state suits 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 onto the agreement, he said.
The landmark agreement — the largest of its kind in U.S. history — 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.
The master settlement agreement created a broad array of restrictions on the advertising, marketing and promotion of cigarettes. For example, it bans targeting children through advertising. It also includes prohibitions on outdoor advertising of cigarettes and the advertising of cigarettes in public transit facilities, as well as the use of cigarette brand names on merchandise, and a host of other restrictions.
Miller said the central purpose of the negotiating the agreement was to reduce smoking, and particularly youth smoking in the United States. Since it was announced, cigarette sales in the United States have fallen substantially and youth smoking has declined even more, he said. But, despite the gains, tobacco remains the No. 1 cause of preventable death in the United States.