tobacco settlement

15 Years Later, Where Did All The Cigarette Money Go?

Fifteen years after tobacco companies agreed to pay billions of dollars in fines in what is still the largest civil litigation settlement in U.S. history, it’s unclear how state governments are using much of that money.

So far tobacco companies have paid more than $100 billion to state governments as part of the 25-year, $246 billion settlement.

Among many state governments receiving money, Orange County, Calif., is an outlier. Voters mandated that 80 percent of money from tobacco companies be spent on smoking-related programs, like a cessation class taught in the basement of Anaheim Regional Medical Center.

“So go ahead and take a minute or two to write down reasons why you want to quit and we’ll talk about them in just a bit,” Luisa Santa says at the start of a recent session.

Every year since 1998, this program has been funded by money from the tobacco settlement. The five-part class is free for anyone living or working in Orange County. When they sign up, participants get a “quit kit” full of things like toothpicks and gum. And, if they come for at least three of the five sessions, they get a free two-week supply of nicotine patches.

Making Big Tobacco Pay

In the mid-1990s, Mississippi was the undisputed leader on the tobacco issue. In 1994, Mike Moore, the state attorney general, filed the first state lawsuit against big tobacco.

Individual lawsuits by smokers failed because courts held people responsible for their decision to smoke, but Moore argued that Mississippi shouldn’t be forced to pay the costs of treating smoking-related diseases.

“Things such as lung cancer, heart disease, emphysema, low-birth-weight babies and others, we have to pay,” Moore told NPR in a 1994 interview. “The state is obligated to pay for those for our citizens that are not covered in other ways, and we feel like they’re caused by the tobacco products.”

Moore argued that tobacco companies should pay for medical bills, and eventually the courts agreed. That agreement said no ads and no targeting youth. Popular advertising characters like Joe Camel and the Marlboro Man were killed off as a result.

The settlement left the tobacco industry immune from future state and federal suits, but the agreement said nothing about how states had to spend the money. Looking back on it, Moore remembers it was a long slog.

“It was not an easy task,” Moore tells NPR’s Arun Rath. “When we filed our case here in 1994, my governor actually sued me to try to stop the tobacco case.”

The tobacco companies sued Moore as well, he says, and it went all the way to the Supreme Court. “It took me two years before I even had five states who would agree to join the efforts.”

Moore now serves on the board of directors of the American Legacy Foundation, a group created by the tobacco settlement. The organization’s mission is to create national anti-smoking campaigns, like the .

The tobacco settlement included money specifically to fund public service announcements, but Moore says most of the settlement money came with no strings attached, and that has made it impossible to hold states accountable.

In Mississippi, where the settlement money was put into a trust fund, a lot of it was spent on things other than smoking prevention and health care, Moore says.

“What happened as the years went by, legislators come and go, and governors come and go … so we got a new governor and he had a new opinion about the tobacco trust fund,” he says. “So a trust fund that should have $2.5 billion in it now doesn’t have much at all, and unfortunately that’s one of my biggest disappointments.

(More on NPR)