Colorado Gets $107M Settlement From Tobacco Companies

DENVER, CO -- Colorado's tobacco health programs will get a $107 million windfall this year, thanks to a settlement with the major tobacco companies announced Tuesday. Attorney General Cynthia Coffman announced that 26 states and Colorado had agreed to accept a payment of certain funds withheld yearly from the payments due to the state under the 1998 original Master Settlement Agreement with Big Tobacco.

Colorado will also receive its yearly payment of $75 million from the MSA. Both payments will be remitted April 19. So far, Colorado has received nearly $1.7 billion in payments, Coffman's office said in a press release. "The settlement funds have been distributed pursuant to a statutory formula for the benefit of various programs, including the Nurse Home Visitor Program, Children’s Basic Health Plan Trust, and the State Veterans Trust," Coffman said.

After the 1998 MSA agreement, which paid out billions to recover state healthcare costs associated with smoking related illnesses, the Big Four tobacco companies -- Philip Morris, R. J. Reynolds, Brown & Williamson and Lorillard -- sued about 45 smaller tobacco companies that had not participated in the agreement.

In addition, litigation with the states began in 2003-2006 to withhold a portion of the MSA funds based on how well participating companies' products sold in each state.

This new agreement accelerates the payments that were withheld into a lump sum.

“This settlement guarantees that Colorado will immediately receive significant funds and avoid costly litigation,” said Coffman in a statement. “Under the terms of this settlement, we get the money into the State now to benefit the citizens of Colorado.”

The settlement money will become part of the state’s general fund, and the legislature will determine how those funds will be used, a press release said.

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