Kentucky receives $129 million in annual tobacco settlement money
“Since 1998, Kentucky has received over $2.5 billion from tobacco manufacturers under the Master Settlement Agreement"
FRANKFORT, Ky. (WTVQ/PRESS RELEASE) – Attorney General Daniel Cameron today announced that Kentucky has received more than $129 million for the 2022 annual payment from the Tobacco Master Settlement Agreement (MSA).
“Since 1998, Kentucky has received over $2.5 billion from tobacco manufacturers under the Master Settlement Agreement, which our office administers,” said Attorney General Cameron. “These funds provide essential support to agricultural diversification initiatives, as well as childhood development and health and wellness programs across the Commonwealth.”
In 1998, Kentucky and 51 other states and territories reached the Master Settlement Agreement with cigarette manufacturing companies. The historic settlement resolved state lawsuits against major tobacco companies for Medicaid costs related to smoking.
Under the terms of the settlement, participating cigarette manufacturers must make a yearly payment to the states based on an annually adjusted rate per number of cigarettes sold each year. Participating manufacturers must make payments to the Commonwealth while they sell cigarettes.
The MSA serves two purposes – to obtain annual compensation for tobacco-related medical expenses and to reduce the number of new and underage smokers.
Each state determines how the settlement funds are used. Kentucky’s General Assembly has allocated 50 percent of the MSA funds for agricultural diversification. These funds are distributed by the Office of Agricultural Policy in the form of grants.
The remaining 50 percent of the funding is split evenly between the early childhood development fund and the Kentucky Health Care Improvement Fund. Grants awarded by these programs are overseen by the Tobacco Settlement Agreement Fund Oversight Committee.
Assistant Attorney General Michael Plumley administers the MSA on behalf of the Attorney General’s Office.