Tuesday, December 21, 1999
Ohio cashes 1st tobacco settlement check
No plan yet on how to spend $10.1B
The Cincinnati Enquirer
Ohio has received its first payment under the national settlement with the tobacco industry.
The $124,377,649.28 all goes to Ohioans. Similar payments will be received in January of 2000, 2001, 2002 and 2003.
In addition to those January payments, Ohio will receive unspecified amounts each May forever, Attorney General Betty Montgomery said. Those May payments begin in 2000.
States sued the tobacco industry in part to recover money taxpayers spent to treat smoking-related illnesses.
None of the estimated $10.1 billion that Ohio expects over 25 years will go for attorneys, Chris Davey, spokesman for the attorney general, said on Monday.
The settlement requires tobacco to compensate the outside lawyers directly for representing the states.
In Ohio, that includes Cincinnatians Norman and John Murdock and Charles R. “Rocky” Saxbe of Columbus. They asked for the 10 per cent that the attorney general agreed to when she hired them and thought their fees would come from the state's share of the settlement.
It was one of the lowest percentages among the 46 states.
Tobacco rejected 10 percent, Mr. Saxbe said on Monday.
If negotiations fail, the national agreement requires lawyers and tobacco to accept whatever an arbitrator awards. “We have not settled; we have not failed to settle,” he said.
Although Ohio was one of the last states to enter the national suit, its estimated share was fourth-largest, Mr. Davey said. The national settlement was an estimated $206 billion.
Ohio's treasurer is investing the tobacco payments until the General Assembly decides how to spend it.
This month, the Senate rejected a spending plan for Ohio's tobacco settlement, forcing House and Senate lawmakers to sit down in the next month to resolve their differences.
Senators voted 18-8 against a 26-year proposal approved by the House.
In addition to wanting to spend the money over 12 years, Senate Republicans rejected other aspects of the House plan. Chief among those is a proposal to spend 5 percent of the $1 billion set aside in the plan's Public Health Trust Fund to help poor people and senior citizens pay for prescription drugs and oxygen needed for respiratory ailments.
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