Name: Campaign for Tobacco-Free Kids
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A State-by-State Look at the
1998 Tobacco Settlement 26 Years Later

Despite receiving over $22 billion from the tobacco settlement and tobacco taxes this year, most states continue to shortchange programs designed to prevent kids from using tobacco products and help tobacco users quit. A handful of states, though, are setting a positive example for other states to follow. This report is a challenge to states to do more to fight tobacco use – still the nation’s leading preventable cause of death – and prevent e-cigarettes from addicting a new generation of kids.

Since the states settled their lawsuits against the major tobacco companies in 1998, our annual reports have assessed whether the states are keeping their promise to use a significant portion of their settlement funds – estimated at $246 billion over the first 25 years – to attack the enormous public health problems caused by tobacco use in the United States. In addition, most states now have additional revenues that could be dedicated to tobacco prevention programs because of more than $1.1 billion in recent legal settlements with Juul for its deceptive marketing practices and its role in the youth e-cigarette epidemic. To fully undo the harm caused by Juul, states should be using this money for youth prevention efforts.

This year (fiscal year 2025), the states will collect $22.1 billion from the 1998 tobacco settlement and tobacco taxes. But they will spend just 3.5% of it – $764.8 million – on tobacco prevention and cessation programs. This total is a $36.2 million increase from last year but still less than a quarter (23.1%) of the total funding recommended by the Centers for Disease Control and Prevention (CDC). These low levels of funding are even more alarming when compared to the $8.6 billion the tobacco companies spend annually to market their deadly and addictive products.

The overall increase in spending can be attributed primarily to three states – Colorado, California and Massachusetts. Colorado’s increase is due to a tobacco and e-cigarette tax increase voters approved in 2020, with some funds allocated for tobacco prevention and cessation programs. California, Massachusetts and several other states have additional funds from their recent legal settlement with Juul.

Other key findings in this report:

Maine is the only state to fund tobacco prevention and cessation programs at or above the CDC-recommended levels.
Only 9 other states (Oklahoma, Utah, Delaware, Colorado, Oregon, California, Alaska, North Dakota and Hawaii) provide more than half of the CDC-recommended funding.
31 states are providing less than 25% of what the CDC recommends; 18 states provide less than 10%; 10 states provide less than 5%.
Tobacco companies spend $11 to market tobacco products for every $1 the states invest to reduce tobacco use. According to the most recent data from the Federal Trade Commission (for 2022), the major tobacco companies spend $8.6 billion a year – nearly $1 million per hour – to market cigarettes and smokeless tobacco products in the U.S.

The recent U.S. Surgeon General’s report on tobacco-related disparities demonstrates why tobacco prevention and cessation programs are as critical as ever. It shows that while the United States has made substantial progress in reducing smoking and other tobacco use, there are large and unacceptable disparities in who uses tobacco and who suffers from tobacco-related disease. The report details the industry’s pervasive role in creating and perpetuating tobacco-related disparities, including manipulating products to make them more appealing and addictive, targeting marketing to youth, communities of color, and other populations and fighting policies to reduce tobacco use.

Tobacco prevention and cessation programs play a critical role in the prevention of many chronic and costly diseases. These programs prevent kids from starting to smoke, assist youth addicted to nicotine, help adult smokers quit, serve as a counter to the ever-present tobacco industry and help reduce tobacco-caused health care costs.

This report is issued by the Campaign for Tobacco-Free Kids, American Heart Association, American Cancer Society Cancer Action Network, American Lung Association, Americans for Nonsmokers’ Rights and Truth Initiative.