WA Leaders Consider “Selling Off” Rest Of Tobacco Settlement Money
The budget shortfall is so serious in Olympia, that some Democrats are floating the idea of “selling off” the rest of the state’s tobacco settlement money.
If you go back to 1998, you may remember when 46 states sued the big four tobacco companies and won a huge settlement. Over a 25 year period, states would receive a total of 25 BILLION dollars, to be spent in a variety of ways. Now, Senate Democrats are proposing that to raise much needed funds, the state “sell off” the rest of it’s Tobacco Settlement money! Ten years ago, when Senate Majority Leader Lisa Brown was the Senate Democratic Budget writer, she hatched a similar plan that was grudgingly approved by Governor Gregoire. Technically, it’s called securitization; but it’s the same principle as a business selling it’s debt to a collection agency for pennies on the dollar. A good chunk of the state’s money was “securitized.”
Senate GOP Leader Mark Schoessler (Ritzville) reports that plan gave the state 27 cents on the dollar, but over the last ten years, the state has missed out on nearly 100 million each year from the settlement because the money was sold. Now, a group of Seattle Democrats are proposing the same idea, to sell off what is left of the money. The sponsor of the bill says they want to give that option to budget negotiators. If it were passed, the securitization would net the state about 350 million, not nearly enough to close the one plus billion dollar defecit.
Senator Schoessler and other GOP leaders have a novel idea–don’t spend more than what we have…