Treasurer Kennedy Says Louisiana Legislature Was Wise to Sell 60 Percent of Settlement

BATON ROUGE, LA State Treasurer John Kennedy is citing a national study as evidence that the Louisiana Legislature made a wise decision in selling 60 percent of the state’s tobacco settlement. According to a report released from the Council of State Governments, states collecting annual payments from the multi-billion dollar national tobacco settlement can expect a $14 billion reduction in anticipated payments over the next nine years. Were already seeing proof that the state was smart to sell when it did, said Treasurer Kennedy. We will see over the next few years how much we could have lost if we hadn’t. The Council of State Governments says lower payments are a result of a continued decline in national tobacco manufacturers cigarette sales. Because annual payments are directly tied to cigarette purchases, states are seeing less money as sales continue to drop 1.5 percent each year. The Council also says payments to states are decreasing each year because smaller cigarette companies are experiencing a steady growth in revenue. Because these companies were not included in the national tobacco settlement, they do not have to pay states annually. In addition to selling 60 percent of the settlement, the Legislature was wise to put this money into a trust fund to protect the future of our children and grandchildren, said Treasurer Kennedy. Many states depend on their tobacco revenue streams to balance their budgets. When the money runs out in these states, it runs out permanently.

To access the complete Tobacco Settlement and Declining State Revenues report from the Council of State Governments, visit www.latreasury.com.

Contact:
Sarah Mulhearn
(225) 342-0012