Tobacco companies agree to give Kentucky more than US$110M to settle 10-year legal battle over state's share of tobacco master settlement agreement

Nevin Barich

FRANKFORT, Kentucky , June 12, 2014 (Associated Press) – Tobacco companies have agreed to give Kentucky more than $110 million to settle a 10-year legal battle over the state's share of the tobacco master settlement agreement.

In 1998, U.S. tobacco companies agreed to pay $229 billion to 52 states and territories over many years to compensate for the costs of treating smoking-related illnesses. Kentucky had to tax tobacco companies that did not participate in the agreement.

The big tobacco companies accused Kentucky of not collecting all of those taxes. As a result, they withheld some of Kentucky's annual payments. State officials and tobacco companies have been fighting over those disputed payments since 2003.

Democratic Gov. Steve Beshear and Attorney General Jack Conway said the money will go to pay for a range of agricultural and public health programs.

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