Summary: The U.S. Centers for Disease Control and Prevention (CDC) recommends that DC spend $10.5 million a year to have an effective, comprehensive tobacco prevention program.  DC currently receives $4.0 million a year for tobacco prevention and cessation, which includes both state and federal funds.  This is 38.1% of the CDC's recommendation and ranks DC 15th among the states in the funding of tobacco prevention programs.  DC's spending on tobacco prevention amounts to 5.1% of the estimated $78 million in tobacco-generated revenue the state collects each year from settlement payments and tobacco taxes.

Recent Developments: The District of Columbia was among the last localities to make a decision on how to use its tobacco settlement funds. In 2001, after three years of budget debates with no spending decisions, the City Council agreed to then-Mayor Anthony Williams' (D) plan to securitize most of the settlement funds by issuing bonds backed by the $1 billion that city expects to receive over the next 25 years. The money raised was transferred into a trust fund and will be used to pay the city's debt. The tobacco settlement payments are used every year to re-pay the bonds. Once the bondholders are paid, any remaining money from the trust will be held in escrow for three years. Beginning in 2004, any remaining funds are to be available for expenditure for other programs. These funds are still subject to appropriation by the City Council and Mayor. A Reserve Fund was also created to cover any residual cost from each year's payment. If the money in the Reserve Fund is not needed for the bond payment in June, a portion will be released in July each year for other expenditures. The Mayor and City Council must then agree on how to spend any residual funds. Beginning in fiscal year 2007, the DC City Council allocated $10 million for a tobacco prevention program over three years. The program and funds are administered by the American Lung Association of DC. In FY2007 DC spent $2.4 million and allocated $3.6 million in both FY2008 and FY2009. For FY2009, DC will receive $4.0 million in federal and state funds for tobacco prevention programs.