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NOVEMBER 1998

The proposed tobacco settlement

A proposed settlement between states' attorneys general and tobacco companies should be used to cut state and local taxes, according to Business Council President Daniel B. Walsh.

The proposed settlement announced earlier this month would bring $25 billion to New York in the next 25 years. After the proposed deal was announced, various spending advocates promptly advanced ideas for spending this money.

"But this litigation was premised on the argument that tobacco use had driven up Medicaid costs-costs already born by state and local taxpayers. For this reason, the settlement is really a reimbursement for taxpayers, and doing anything else with the money is unthinkable," Walsh said.

November 24, 1998