Tobacco Settlement

Montana filed suit against "Big Tobacco" in May 1997 and the state was part of the national settlement reached by the attorneys general in November 1998. The state regularly receives payments as part of the Master Settlement Agreement (MSA). Prior to January 1, 2001, tobacco industry payments went directly into Montana's general fund and were allocated by the legislature.

Trust Fund

In November 2000, Montana voters approved Constitutional Amendment 35, which dedicated at least 40 percent of the tobacco settlement to a permanent, income-producing trust fund. Of the interest earned by this trust fund, 90 percent must be used for health care benefits, services, education programs and tobacco disease prevention. The remaining 10 percent is reinvested in the trust fund. From fiscal year 2001 to 2003, the larger share of the tobacco payments (60 percent) was deposited in the general fund and appropriated by the legislature.

Under Initiative 146 approved by voters in November 2002, and subsequent legislative changes in 2003, Montana's tobacco settlement money is now distributed as follows:

• 40 percent – Tobacco Trust Fund
• 32 percent – Tobacco prevention/cessation and human service programs
• 17 percent – Children's Health Insurance Program, Comprehensive Health Association programs and Medicaid matching funds
• 11 percent – General fund

Settlement Payments

Tobacco manufacturers that participated in the Master Settlement Agreement have made the following payments to the state of Montana.