Yesterday's $57 million deposit pushes a state fund created to fight tobacco addiction and promote health and wellness past the half-billion dollar mark. Attorney General Drew Edmondson and State Treasurer Scott Meacham said Oklahoma received more than $77.1 million yesterday from the tobacco industry, 75 percent of which went directly into the Tobacco Settlement Endowment Trust (TSET).
Meacham's office confirmed receipt of a wire transfer in the amount of $77,138,626.91 from the trustee of the tobacco settlement funds. More than $57.8 million of the payment was deposited in Oklahoma's TSET fund, which now has a balance of almost $558 million.
"Public health was at the heart of our lawsuit against big tobacco," Edmondson said, "and the tobacco trust will ensure that the bulk of the monies generated from the settlement are focused on this important issue. The trust will also provide a perpetual source of public health funding which is crucial in hard economic times."
TSET was created by a voter-approved amendment to the Oklahoma Constitution in 2000, which specifies that only the earnings from the trust fund may be spent on programs to improve the health and well-being of Oklahomans. To date, the fund has generated more than $63 million in earnings, including $18 million last year alone.
"These funds were immediately transferred to income-generating investments so more money can be earned for use improving the health of Oklahomans," Meacham said. "The people of Oklahoma will benefit from this money as it is used to help them live longer, healthier lives."
This year's payment included the third allocation of Oklahoma's share of the agreement's strategic contribution funds. These funds were awarded to the state for the strategic contribution Edmondson, his office and local counsel made to the prosecution of the lawsuit and will be added to Oklahoma's annual tobacco payment for ten years. Oklahoma should receive about $26.8 million in strategic contribution funds each year.
In August 1996 Oklahoma became the 14th state to file a lawsuit against the tobacco companies, asking for restraints against the industry and monetary damages for state funds spent treating smoking-related illnesses. Oklahoma sought about $1 billion in damages.
In November 1998, Edmondson and seven other attorneys general announced they had, on behalf of the states, negotiated a historic settlement with big tobacco. The settlement imposed sweeping changes in tobacco advertising, banned the tobacco companies from targeting children, allocated funding for tobacco education efforts and provided the states annual payments based on the number of cigarettes sold in the country. The total of payments over 25 years was projected to be in excess of $206 billion, and payments will continue as long as cigarettes are sold.
Oklahoma's share of the settlement is estimated to be $2.03 billion over 25 years. An additional $268 million was awarded to the state for the strategic contribution Edmondson, his office and local counsel made to the prosecution of the lawsuit. Attorney fees were paid by the tobacco industry and did not come from Oklahoma's share of the settlement.