Revenge against Big Tobacco to taste less sweet

As lawmakers in Richmond grapple with the idea of banning indoor smoking, the tobacco industry is getting ready to take its ball and go home. The Associated Press has learned that Virginia's share of the payout from the landmark 1998 Master Settlement Agreement against the tobacco industry might decline significantly in 2007 as a result of market fluctuations.

Last year, the payments made nationally by several cigarette manufacturers decreased by about $800 million thanks to an escape clause that allows them to reassess the amount owed based on market share. That cost Virginia about $16 million, and the $1.14 billion national decrease being discussed for 2007 threatens to lop off another $20 million – or even up to $23 million, if you ask the Richmond Times-Dispatch.

The money will come straight out of the coffers of the state Medicaid program and anti-smoking education programs run by the Virginia Tobacco Settlement Foundation, which was created after the 1998 agreement specifically to help translate part of the settlement monies into smoke-free kids, and which just so happens to include John O. James, Jr. of WINA on its board of trustees. Half of the funds received also go towards economic initiatives designed to ease the strain placed on regions with tobacco-centric economies.

Last year's decrease resulted in a lawsuit over the difference being filed against the offending corporations. This year's payment is supposed to hit in April, with the grand total for all tobacco companies and all states coming to somewhere in the neighborhood of $6.5 billion.