This is the accessible text file for GAO report number GAO-05-312 entitled 'Tobacco Settlement: States' Allocations of Fiscal Year 2004 and Expected Fiscal Year 2005 Payments' which was released on March 22, 2005. This text file was formatted by the U.S. Government Accountability Office (GAO) to be accessible to users with visual impairments, as part of a longer term project to improve GAO products' accessibility. Every attempt has been made to maintain the structural and data integrity of the original printed product. Accessibility features, such as text descriptions of tables, consecutively numbered footnotes placed at the end of the file, and the text of agency comment letters, are provided but may not exactly duplicate the presentation or format of the printed version. The portable document format (PDF) file is an exact electronic replica of the printed version. We welcome your feedback. Please E-mail your comments regarding the contents or accessibility features of this document to Webmaster@gao.gov. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. Because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately. Report to Congressional Requesters: March 2005: Tobacco Settlement: States' Allocations of Fiscal Year 2004 and Expected Fiscal Year 2005 Payments: [Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-05-312]: GAO Highlights: Highlights of GAO-05-312, a report to congressional requesters: Why GAO Did This Study: In the 1990s, states sued major tobacco companies to obtain reimbursement for health impairments caused by the public's use of tobacco. In 1998, 46 states and four of the nation's largest tobacco companies signed a Master Settlement Agreement (MSA) that requires the tobacco companies to make annual payments to the states in perpetuity as reimbursement for past tobacco-related health care costs. The MSA commits the tobacco companies to pay the states approximately $206 billion over the first 25 years. Some of the states have arranged to receive upfront proceeds based on the amounts that tobacco companies owe by issuing bonds backed by future payments. The Farm Security and Rural Investment Act of 2002 requires GAO to report annually on the amount of MSA payments that states receive through fiscal year 2006. This fourth report provides information on: * the payments the 46 states received in fiscal year 2004 and expect to receive in fiscal year 2005 and: * states' allocations of these funds to various program categories and changes from prior years. To conduct this study, GAO surveyed the 46 states. What GAO Found: The 46 states party to the MSA expect to receive about $15.1 billion in fiscal years 2004 and 2005. States reported they received about $9.7 billion in fiscal year 2004 and expect to receive about $5.4 billion in fiscal year 2005. About 70 percent of these amounts will be MSA payments from the tobacco companies, and 30 percent will be proceeds from the sale of bonds (securitized proceeds) backed by payments tobacco companies will make in the future. In addition, only 1 state expects to receive securitized tobacco settlement funds in fiscal year 2005, so the amount of securitized proceeds are expected to decline in fiscal year 2005 to about $64 million, down from the $4.4 billion states received in 2004. Over the 4 prior fiscal years, states also reported receiving a total of about $36.8 billion. These amounts include $25.7 billion in payments from tobacco companies and, for some states, $11.1 billion in securitized proceeds. The MSA allows states to use their tobacco settlement payments for any purpose. States reported that they used the largest portions of the fiscal year 2004 payments to address budget shortfalls (about 44 percent) and to fund health-related programs (20 percent). Compared with fiscal year 2004, states in fiscal year 2005 expect to decrease allocations to address budget shortfalls (11 percent) and to increase allocations to both health-related programs (32 percent) and debt service on securitized funds (23 percent). Categories to Which States Allocated the Largest Portion of Tobacco Settlement Payments (Fiscal Year 2004 and Expected Fiscal Year 2005 Allocations): [See PDF for image] [End of figure] www.gao.gov/cgi-bin/getrpt?GAO-05-312. To view the full product, including the scope and methodology, click on the link above. For more information, contact Robert A. Robinson, 202- 512-3841, robinsonr@gao.gov. [End of section] Contents: Letter: Results in Brief: States Received about $9.7 Billion in MSA Payments and Securitized Proceeds in Fiscal Year 2004 and Expect to Receive about $5.4 Billion in Fiscal Year 2005: States Allocated the Largest Portion of their Funds to Cover Budget Shortfalls in Fiscal Year 2004 and Expect to Allocate the Largest Portion to Health-Related Programs in Fiscal Year 2005: Appendixes: Appendix I: Objectives, Scope, and Methodology: Survey Methodology and Categorization of States' Allocations: Categories of States' Allocations: Appendix II: Allocations of MSA Payments for 46 States: Appendix III: States' Allocations of Combined MSA Payments and Securitized Proceeds for Fiscal Years 2000 through 2005: Appendix IV: State-Specific Information on Amounts of Master Settlement Agreement Payments and Securitized Proceeds Received and Allocated: Appendix V: GAO Survey on States' Allocations of Fiscal Years 2004 and 2005 Master Settlement Agreement Payments: Appendix VI: GAO Contact and Staff Acknowledgments: GAO Contact: Staff Acknowledgments: Tables: Table 1: MSA Payments and Securitized Proceeds that States Reported Receiving in Fiscal Year 2004 and Expect to Receive in Fiscal Year 2005: Table 2: Total MSA Payments and Securitized Proceeds Received since Fiscal Year 2000: Table 3: MSA Payments and Securitized Proceeds Allocated or Expected to Be Allocated to Various Categories, Fiscal Years 2004 and 2005: Table 4: Allocation of States' Combined MSA Payments and Securitized Proceeds, Fiscal Year 2004: Table 5: Expected Allocation of States' Combined MSA Payments and Securitized Proceeds, Fiscal Year 2005: Table 6: Alabama's MSA Payment Allocations: Table 7: Alaska's MSA Payment Allocations: Table 8: Arizona's MSA Payment Allocation: Table 9: Arkansas's MSA Payment Allocations: Table 10: California's MSA Payment Allocation: Table 11: Colorado's MSA Payment Allocations: Table 12: Connecticut's MSA Payment Allocation: Table 13: Delaware's MSA Payment Allocations: Table 14: Georgia's MSA Payment Allocations: Table 15: Hawaii's MSA Payment Allocations: Table 16: Idaho's MSA Payment Allocations: Table 17: Illinois's MSA Payment Allocations: Table 18: Indiana's MSA Payment Allocations: Table 19: Iowa's Allocations of MSA Payments and Securitized proceeds: Table 20: Kansas's MSA Payment Allocations: Table 21: Kentucky's MSA Payment Allocations: Table 22: Louisiana's MSA Payment Allocations: Table 23: Maine's MSA Payment Allocations: Table 24: Maryland's MSA Payment Allocations: Table 25: Massachusetts's MSA Payment Allocation: Table 26: Michigan's MSA Payment Allocations: Table 27: Missouri's MSA Payment Allocations: Table 28: Montana's MSA Payment Allocations: Table 29: Nebraska's MSA Payment Allocations: Table 30: Nevada's MSA Payment Allocations: Table 31: New Hampshire's MSA Payment Allocations: Table 32: New Jersey's Allocations of MSA Payments and Securitized proceeds: Table 33: New Mexico's MSA Payment Allocations: Table 34: New York's Allocation of MSA Payments and Securitized proceeds: Table 35: North Carolina's MSA Payment Allocations: Table 36: North Dakota's MSA Payment Allocations: Table 37: Ohio's MSA Payment Allocations: Table 38: Oklahoma's MSA Payment Allocations: Table 39: Oregon's Allocations of MSA Payments and Securitized proceeds: Table 40: Pennsylvania's MSA Payment Allocation: Table 41: Rhode Island's Allocations of MSA Payments and Securitized proceeds: Table 42: South Carolina's MSA Payment Allocation: Table 43: South Dakota's MSA Payment Allocations: Table 44: Tennessee's MSA Payment Allocation: Table 45: Utah's MSA Payment Allocations: Table 46: Vermont's MSA Payment Allocations: Table 47: Virginia's MSA Payment Allocations: Table 48: Washington's MSA Payment Allocations: Table 49: West Virginia's MSA Payment Allocations: Table 50: Wisconsin's MSA Payment Allocation: Table 51: Wyoming's MSA Payment Allocations: Figures: Figure 1: Securitized Proceeds Received by States since Fiscal Year 2000: Figure 2: States’ Allocations of Combined MSA Payments and Securitized Proceeds for Fiscal Years 2000-01, 2002, 2003, and 2004 and Expected Allocations for Fiscal Year 2005: Letter March 21, 2005: Congressional Requesters: In the 1990s, states sued major tobacco companies to obtain reimbursement for health impairments caused by the public's use of tobacco. During 1997 and 1998, 4 states--Florida, Minnesota, Mississippi, and Texas--settled their lawsuits with the tobacco industry by negotiating independent agreements.[Footnote 1] In November 1998, four of the nation's largest tobacco companies--Philip Morris, USA;[Footnote 2] R.J. Reynolds Tobacco Company; Brown & Williamson Tobacco Corporation; and Lorillard Tobacco Company--negotiated and signed an agreement with the attorneys general of the remaining 46 states, the District of Columbia, and the five U.S. territories, thereby settling a number of lawsuits brought by these parties against the companies.[Footnote 3] This agreement is known as the Master Settlement Agreement (MSA). The MSA commits the tobacco companies to make annual payments to the 46 states in perpetuity as reimbursement for health care costs, such as Medicaid expenditures, related to tobacco use.[Footnote 4] These payments will total approximately $206 billion over the first 25 years.[Footnote 5] Each state receives a share of the annual MSA payments based on a fixed percentage identified in the MSA. The MSA imposed no requirements on how states could spend their payments. The Farm Security and Rural Investment Act of 2002 (the 2002 Farm Bill) requires us to report annually on payments made by tobacco companies for fiscal years 2002 through 2006 and how states use these funds. In addition, 14 of the 46 states have received substantial advance proceeds based on the amounts that tobacco companies owe by issuing bonds backed by payments to be made in the future, a process known as securitization. States can securitize a portion of the expected payment stream to receive funds upfront rather than over time as MSA payments are made. The proceeds of these bonds have often been earmarked for meeting budget shortfalls. This report also includes information about states' receipt and allocation of these securitized proceeds.[Footnote 6] This report is the fourth in a series of reports responding to the 2002 Farm Bill requirement.[Footnote 7] In addition, we previously reported in June 2001 on states' receipt and use of MSA payments for fiscal years 2000 and 2001.[Footnote 8] This report discusses (1) the amount of payments, including securitized proceeds, received by the 46 states party to the MSA during fiscal year 2004, and the amount of payments these states expect to receive in fiscal year 2005, and (2) states' allocation of these funds to various program categories for fiscal year 2004 and expected allocations for fiscal year 2005. To address our objectives, we surveyed state budget offices, or their designees, in each of the 46 states to obtain MSA payment and allocation information for fiscal years 2004 and 2005.[Footnote 9],[Footnote 10] We asked the states to categorize their MSA payment allocations for fiscal year 2004 and their expected allocations for fiscal year 2005 using 13 categories. In addition, we asked states if they securitized their payments and, if so, the amount of proceeds they received from securitization and the categories to which they allocated the securitized proceeds. We took a number of steps to assess the reliability of the states' data, including independently corroborating these data to the extent possible. We determined that these data were reliable enough for our purposes. In addition, we compared the data we received for fiscal years 2004 and 2005 with the payment and allocation information we collected from states for our earlier GAO reports.[Footnote 11] Appendix I contains more information on our scope and methodology and detailed definitions of the categories used in this report.[Footnote 12] Appendix II shows each state's percentage share of annual MSA payments. These payments are adjusted for several factors, most notably, the future sales of the tobacco industry. Each state's payments are adjusted annually on the basis of the participating manufacturer's cigarette sales and market share, as well as inflation. We conducted our work from July 2004 through February 2005 in accordance with generally accepted government auditing standards. Results in Brief: The 46 states party to the MSA expect to receive about $15.1 billion in MSA payments and securitized proceeds in fiscal years 2004 and 2005. These states reported receiving a total of about $9.7 billion in MSA payments and securitized proceeds in fiscal year 2004 and expect to receive about $5.4 billion in fiscal year 2005. About 70 percent of these amounts will be MSA payments from the tobacco companies, and 30 percent will be securitized proceeds. The amounts of securitized proceeds that states received and expect to receive are declining, and only 1 state expects to receive securitized tobacco settlement funds in fiscal year 2005. Specifically, fiscal year 2005 securitized proceeds are expected to decline to about $64 million, down from the $4.4 billion that states received in 2004 and the $6.5 billion they received in 2003. In the 4 prior years, fiscal years 2000 through 2003, states reported receiving about $36.8 billion--that is, about $25.7 billion in MSA payments from the tobacco companies and about $11.1 billion in securitized proceeds. States allocated the largest portions of their fiscal year 2004 tobacco settlement funds to address budget shortfalls (44 percent) and for health-related programs (20 percent), but they did not expect the same to hold true for fiscal year 2005. In fiscal year 2005, states expect to allocate the largest portions of their tobacco settlement funds to address health-related programs (32 percent) and debt service (23 percent) on securitized funds. Compared with fiscal year 2004, states in fiscal year 2005 expect to decrease allocations to budget shortfalls and to increase allocations to health-related programs and to debt service on securitized funds. Also, while the percentage allocations to some program categories are expected to increase in fiscal year 2005, the dollars allocated may decrease. For example, the percentage allocation to health care is expected to increase, while the dollar amount is expected to decrease from about $2.3 billion in fiscal year 2004 to about $1.9 billion in fiscal year 2005. States Received about $9.7 Billion in MSA Payments and Securitized Proceeds in Fiscal Year 2004 and Expect to Receive about $5.4 Billion in Fiscal Year 2005: The 46 states party to the MSA reported receiving a total of about $9.7 billion in fiscal year 2004--that is, about $5.3 billion in MSA payments from the tobacco companies and, for 4 of the states, about $4.4 billion in securitized proceeds. For fiscal year 2005, the 46 states are expecting to receive a total of about $5.4 billion--that is, about $5.3 billion in MSA payments and, for 1 of the states, about $0.1 billion ($64 million) in securitized proceeds, about $4.3 billion less than in fiscal year 2004 and about $6.4 billion less than fiscal year 2003. Over these 2 fiscal years, of the combined payments (about $15.1 billion) that states will receive, about 70 percent ($10.6 billion) will be MSA payments from the tobacco companies and 30 percent ($4.5 billion) will be securitized proceeds. In fiscal years 2000 through 2003, states reported receiving a total of about $36.8 billion--that is, about $25.7 billion in MSA payments from the tobacco companies and about $11.1 billion in securitized proceeds. Table 1 shows the amount of MSA payments and securitized proceeds each of the 46 states reported receiving in fiscal year 2004 and the amount each state expects to receive in fiscal year 2005. Table 1: MSA Payments and Securitized Proceeds that States Reported Receiving in Fiscal Year 2004 and Expect to Receive in Fiscal Year 2005: State: Alabama; Fiscal year 2004: MSA payments received: $101,871,680; Fiscal year 2004: Total: $101,871,680; Fiscal year 2005: MSA payments expected to be received: $96,000,000; Fiscal year 2005: Total: $96,000,000. State: Alaska; Fiscal year 2004: MSA payments received: $21,438,845; Fiscal year 2004: Total: $21,438,845; Fiscal year 2005: MSA payments expected to be received: $23,347,500; Fiscal year 2005: Total: $23,347,500. State: Arizona; Fiscal year 2004: MSA payments received: $92,648,165; Fiscal year 2004: Total: $92,648,165; Fiscal year 2005: MSA payments expected to be received: $90,304,100; Fiscal year 2005: Total: $90,304,100. State: Arkansas; Fiscal year 2004: MSA payments received: $52,688,976; Fiscal year 2004: Total: $52,688,976; Fiscal year 2005: MSA payments expected to be received: $50,000,000; Fiscal year 2005: Total: $50,000,000. State: California; Fiscal year 2004: MSA payments received: $400,746,161; Fiscal year 2004: Total: $400,746,161; Fiscal year 2005: MSA payments expected to be received: $404,500,000; Fiscal year 2005: Total: $404,500,000. State: Colorado; Fiscal year 2004: MSA payments received: $87,037,529; Fiscal year 2004: Total: $87,037,529; Fiscal year 2005: MSA payments expected to be received: $88,878,470; Fiscal year 2005: Total: $88,878,470. State: Connecticut; Fiscal year 2004: MSA payments received: $116,578,313; Fiscal year 2004: Total: $116,578,313; Fiscal year 2005: MSA payments expected to be received: $109,000,000; Fiscal year 2005: Total: $109,000,000. State: Delaware; Fiscal year 2004: MSA payments received: $24,832,878; Fiscal year 2004: Total: $24,832,878; Fiscal year 2005: MSA payments expected to be received: $26,100,000; Fiscal year 2005: Total: $26,100,000. State: Georgia; Fiscal year 2004: MSA payments received: $156,330,702; Fiscal year 2004: Total: $156,330,702; Fiscal year 2005: MSA payments expected to be received: $146,123,673; Fiscal year 2005: Total: $146,123,673. State: Hawaii; Fiscal year 2004: MSA payments received: $38,837,269; Fiscal year 2004: Total: $38,837,269; Fiscal year 2005: MSA payments expected to be received: $42,574,552; Fiscal year 2005: Total: $42,574,552. State: Idaho; Fiscal year 2004: MSA payments received: $22,818,949; Fiscal year 2004: Total: $22,818,949; Fiscal year 2005: MSA payments expected to be received: $23,830,716; Fiscal year 2005: Total: $23,830,716. State: Illinois; Fiscal year 2004: MSA payments received: $292,256,066; Fiscal year 2004: Total: $292,256,066; Fiscal year 2005: MSA payments expected to be received: $270,989,300; Fiscal year 2005: Total: $270,989,300. State: Indiana; Fiscal year 2004: MSA payments received: $126,800,000; Fiscal year 2004: Total: $126,800,000; Fiscal year 2005: MSA payments expected to be received: $129,300,000; Fiscal year 2005: Total: $129,300,000. State: Iowa; Fiscal year 2004: MSA payments received: $54,609,359; Fiscal year 2004: Securitized proceeds received: $63,512,236; Fiscal year 2004: Total: $118,121,595; Fiscal year 2005: MSA payments expected to be received: $55,137,861; Fiscal year 2005: Securitized proceeds expected to be received: $63,792,236; Fiscal year 2005: Total: $118,930,097. State: Kansas; Fiscal year 2004: MSA payments received: $52,349,060; Fiscal year 2004: Total: $52,349,060; Fiscal year 2005: MSA payments expected to be received: $52,000,000; Fiscal year 2005: Total: $52,000,000. State: Kentucky; Fiscal year 2004: MSA payments received: $109,482,959; Fiscal year 2004: Total: $109,482,959; Fiscal year 2005: MSA payments expected to be received: $108,800,000; Fiscal year 2005: Total: $108,800,000. State: Louisiana; Fiscal year 2004: MSA payments received: $141,621,328; Fiscal year 2004: Total: $141,621,328; Fiscal year 2005: MSA payments expected to be received: $145,362,442; Fiscal year 2005: Total: $145,362,442. State: Maine; Fiscal year 2004: MSA payments received: $48,952,964; Fiscal year 2004: Total: $48,952,964; Fiscal year 2005: MSA payments expected to be received: $48,772,127; Fiscal year 2005: Total: $48,772,127. State: Maryland; Fiscal year 2004: MSA payments received: $149,942,000; Fiscal year 2004: Total: $149,942,000; Fiscal year 2005: MSA payments expected to be received: $142,607,000; Fiscal year 2005: Total: $142,607,000. State: Massachusetts; Fiscal year 2004: MSA payments received: $253,621,276; Fiscal year 2004: Total: $253,621,276; Fiscal year 2005: MSA payments expected to be received: $253,600,000; Fiscal year 2005: Total: $253,600,000. State: Michigan; Fiscal year 2004: MSA payments received: $270,540,221; Fiscal year 2004: Total: $270,540,221; Fiscal year 2005: MSA payments expected to be received: $285,700,000; Fiscal year 2005: Total: $285,700,000. State: Missouri; Fiscal year 2004: MSA payments received: $142,829,966; Fiscal year 2004: Total: $142,829,966; Fiscal year 2005: MSA payments expected to be received: $144,000,000; Fiscal year 2005: Total: $144,000,000. State: Montana; Fiscal year 2004: MSA payments received: $26,672,073; Fiscal year 2004: Total: $26,672,073; Fiscal year 2005: MSA payments expected to be received: $26,223,000; Fiscal year 2005: Total: $26,223,000. State: Nebraska; Fiscal year 2004: MSA payments received: $37,858,162; Fiscal year 2004: Total: $37,858,162; Fiscal year 2005: MSA payments expected to be received: $35,600,000; Fiscal year 2005: Total: $35,600,000. State: Nevada; Fiscal year 2004: MSA payments received: $38,299,907; Fiscal year 2004: Total: $38,299,907; Fiscal year 2005: MSA payments expected to be received: $38,666,164; Fiscal year 2005: Total: $38,666,164. State: New Hampshire; Fiscal year 2004: MSA payments received: $41,800,000; Fiscal year 2004: Total: $41,800,000; Fiscal year 2005: MSA payments expected to be received: $39,600,000; Fiscal year 2005: Total: $39,600,000. State: New Jersey; Fiscal year 2004: MSA payments received: $242,800,000; Fiscal year 2004: Total: $242,800,000; Fiscal year 2005: MSA payments expected to be received: $245,100,000; Fiscal year 2005: Total: $245,100,000. State: New Mexico; Fiscal year 2004: MSA payments received: $37,449,345; Fiscal year 2004: Total: $37,449,345; Fiscal year 2005: MSA payments expected to be received: $34,779,246; Fiscal year 2005: Total: $34,779,246. State: New York; Fiscal year 2004: MSA payments received: $349,494,266; Fiscal year 2004: Securitized proceeds received: $4,200,000,000; Fiscal year 2004: Total: $4,549,494,266; Fiscal year 2005: MSA payments expected to be received: $406,007,613; Fiscal year 2005: Total: $406,007,613. State: North Carolina; Fiscal year 2004: MSA payments received: $150,507,204; Fiscal year 2004: Total: $150,507,204; Fiscal year 2005: MSA payments expected to be received: $163,353,241; Fiscal year 2005: Total: $163,353,241. State: North Dakota; Fiscal year 2004: MSA payments received: $23,289,073; Fiscal year 2004: Total: $23,289,073; Fiscal year 2005: MSA payments expected to be received: $22,972,067; Fiscal year 2005: Total: $22,972,067. State: Ohio; Fiscal year 2004: MSA payments received: $320,531,457; Fiscal year 2004: Total: $320,531,457; Fiscal year 2005: MSA payments expected to be received: $290,886,750; Fiscal year 2005: Total: $290,886,750. State: Oklahoma; Fiscal year 2004: MSA payments received: $65,062,578; Fiscal year 2004: Total: $65,062,578; Fiscal year 2005: MSA payments expected to be received: $49,783,729; Fiscal year 2005: Total: $49,783,729. State: Oregon; Fiscal year 2004: MSA payments received: $72,065,376; Fiscal year 2004: Securitized proceeds received: $109,565,000; Fiscal year 2004: Total: $181,630,376; Fiscal year 2005: MSA payments expected to be received: $73,555,259; Fiscal year 2005: Total: $73,555,259. State: Pennsylvania; Fiscal year 2004: MSA payments received: $370,856,755; Fiscal year 2004: Total: $370,856,755; Fiscal year 2005: MSA payments expected to be received: $357,566,328; Fiscal year 2005: Total: $357,566,328. State: Rhode Island; Fiscal year 2004: MSA payments received: $45,142,523; Fiscal year 2004: Securitized proceeds received: $1,621,487; Fiscal year 2004: Total: $46,764,010; Fiscal year 2005: MSA payments expected to be received: $47,381,000; Fiscal year 2005: Total: $47,381,000. State: South Carolina; Fiscal year 2004: MSA payments received: $73,124,607; Fiscal year 2004: Total: $73,124,607; Fiscal year 2005: MSA payments expected to be received: $75,582,954; Fiscal year 2005: Total: $75,582,954. State: South Dakota; Fiscal year 2004: MSA payments received: $21,911,498; Fiscal year 2004: Total: $21,911,498; Fiscal year 2005: MSA payments expected to be received: $23,063,730; Fiscal year 2005: Total: $23,063,730. State: Tennessee; Fiscal year 2004: MSA payments received: $153,272,096; Fiscal year 2004: Total: $153,272,096; Fiscal year 2005: MSA payments expected to be received: $147,800,000; Fiscal year 2005: Total: $147,800,000. State: Utah; Fiscal year 2004: MSA payments received: $27,936,000; Fiscal year 2004: Total: $27,936,000; Fiscal year 2005: MSA payments expected to be received: $26,951,100; Fiscal year 2005: Total: $26,951,100. State: Vermont; Fiscal year 2004: MSA payments received: $25,819,716; Fiscal year 2004: Total: $25,819,716; Fiscal year 2005: MSA payments expected to be received: $24,700,000; Fiscal year 2005: Total: $24,700,000. State: Virginia; Fiscal year 2004: MSA payments received: $128,396,522; Fiscal year 2004: Total: $128,396,522; Fiscal year 2005: MSA payments expected to be received: $123,256,595; Fiscal year 2005: Total: $123,256,595. State: Washington; Fiscal year 2004: MSA payments received: $127,635,700; Fiscal year 2004: Total: $127,635,700; Fiscal year 2005: MSA payments expected to be received: $128,000,000; Fiscal year 2005: Total: $128,000,000. State: West Virginia; Fiscal year 2004: MSA payments received: $55,663,874; Fiscal year 2004: Total: $55,663,874; Fiscal year 2005: MSA payments expected to be received: $50,800,000; Fiscal year 2005: Total: $50,800,000. State: Wisconsin; Fiscal year 2004: MSA payments received: $130,110,401; Fiscal year 2004: Total: $130,110,401; Fiscal year 2005: MSA payments expected to be received: $137,126,872; Fiscal year 2005: Total: $137,126,872. State: Wyoming; Fiscal year 2004: MSA payments received: $15,594,424; Fiscal year 2004: Total: $15,594,424; Fiscal year 2005: MSA payments expected to be received: $15,594,424; Fiscal year 2005: Total: $15,594,424. Total; Fiscal year 2004: MSA payments received: $5,340,128,223; Fiscal year 2004: Securitized proceeds received: $4,374,698,723; Fiscal year 2004: Total: $9,714,826,946; Fiscal year 2005: MSA payments expected to be received: $5,321,277,813; Fiscal year 2005: Securitized proceeds expected to be received: $63,792,236; Fiscal year 2005: Total: $5,385,070,049. Sources: State budget offices or their designees. Note: The amounts of MSA payments received and expected by California and New York do not include MSA payments made to the counties and cities in those states. [End of table] Since fiscal year 2000, states have received a total of about $47 billion in MSA payments and securitized proceeds; specifically, about $31 billion from MSA payments and $16 billion in securitized proceeds. (See table 2.) Table 2: Total MSA Payments and Securitized Proceeds Received since Fiscal Year 2000: Fiscal year 2000-01; MSA payments: $13,200,000,000; Securitized proceeds: $928,900,000; Total: $14,128,900,000. Fiscal year 2002; MSA payments: $6,238,393,496; Securitized proceeds: $3,740,376,465; Total: $9,978,769,961. Fiscal year 2003; MSA payments: $6,306,329,459; Securitized proceeds: $6,482,764,469; Total: $12,789,093,928. Fiscal year 2004; MSA payments: $5,340,128,223; Securitized proceeds: $4,374,698,723; Total: $9,714,826,946. Fiscal year: Total; MSA payments: $31,084,851,178; Securitized proceeds: $15,526,739,657; Total: $46,611,590,835. [End of table] Sources: [Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-01-851], [Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-03-407], and [Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-518]; state budget offices or their designees (data); and GAO (analysis). Fourteen states have received a total of about $15.5 billion in securitized proceeds from the sale of bonds since fiscal year 2000. Five of these states--Alabama, Alaska, Iowa, Oregon, and Rhode Island- -have received securitized proceeds in more than 1 year. (See fig. 1.) Figure 1: Securitized Proceeds Received by States since Fiscal Year 2000: [See PDF for image] [End of figure] States Allocated the Largest Portion of their Funds to Cover Budget Shortfalls in Fiscal Year 2004 and Expect to Allocate the Largest Portion to Health-Related Programs in Fiscal Year 2005: The 46 states reported that in fiscal year 2004, they allocated the largest portion of their combined MSA payments and securitized proceeds (44 percent) to cover budget shortfalls, and the next largest portion (20 percent) for health-related programs. In fiscal year 2005, the states expected to decrease allocations to budget shortfalls (to about 11 percent) and allocate the largest portion of their funds (32 percent) for health-related programs, and the next largest portion (23 percent) for debt servicing of securitized proceeds. While the percentage allocations to some program categories are expected to increase in fiscal year 2005, the dollars allocated may decrease. For example, the percentage allocation to health care is expected to increase, while the dollar amount is expected to decrease from about $2.3 billion in fiscal year 2004 to about $1.9 billion in fiscal year 2005. Examples of the health-related programs included Medicaid, the Children's Health Insurance Program, and cancer treatment and prevention. Figure 2 provides more detail on states' allocations of their combined MSA payments and securitized proceeds for fiscal years 2000-01, 2002, 2003, and 2004 and expected allocations for fiscal year 2005. In addition, between fiscal years 2004 and 2005, the portion of funds that all states allocate to budget shortfalls is expected to decrease substantially from 44 percent to 11 percent, as shown in figure 2. Our analysis shows that changes in the allocations of securitized proceeds by New York and New Jersey were the primary cause of that decrease. Together, the securitized funds allocated by these two states (about $4.7 billion) accounted for about 41 percent of the total MSA funds ($11.4 billion) that all states allocated in fiscal year 2004, but these amounts declined in fiscal year 2005. Specifically, in fiscal year 2004, New York allocated $3.8 billion of their securitized funds to budget shortfalls while New Jersey allocated $873 million. Together, these allocations accounted for about 92 percent of all funds allocated to budget shortfalls in fiscal year 2004. In fiscal year 2005, however, New York expected to allocate only $400 million[Footnote 13] of their securitized funds to budget shortfalls while New Jersey did not expect to allocate any funds to budget shortfalls. Figure 2: States' Allocations of Combined MSA Payments and Securitized Proceeds for Fiscal Years 2000-01, 2002, 2003, and 2004 and Expected Allocations for Fiscal Year 2005: [See PDF for image] Note: Percentages may not add up to 100 because of rounding. [A] We did not obtain data for budget shortfalls and debt service on securitized funds for fiscal years 2000-01. [End of figure] As table 3 shows, allocations of MSA payments differed somewhat from allocations of securitized proceeds. In fiscal year 2004, the categories to which the 46 states allocated the greatest portion of their MSA payments were health-related programs (nearly 40 percent) and debt service (nearly 18 percent). In contrast, the 5 states that allocated securitized proceeds in fiscal year 2004--Iowa, New Jersey, New York, Oregon, and Rhode Island--allocated the greatest portion of the securitized proceeds to budget shortfalls (nearly 80 percent). In fiscal year 2005, the categories to which the 46 states expected to allocate the greatest portion of their MSA payments were health-related programs (about 33 percent) and debt service (about 25 percent). The only states that expected to allocate securitized proceeds for fiscal year 2005--Iowa and New York--planned to allocate about 86 percent of these proceeds to budget shortfalls. Table 3: MSA Payments and Securitized Proceeds Allocated or Expected to Be Allocated to Various Categories, Fiscal Years 2004 and 2005: Category: Budget shortfalls; Fiscal Year 2004: MSA payments allocated: 6.9%; Fiscal Year 2004: Securitized proceeds allocated: 79.8%; Fiscal Year 2004: Total allocated: 44.3%; Fiscal Year 2005: MSA payments expected to be allocated: 5.2%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 86.2%; Fiscal Year 2005: Total expected to be allocated: 11.4%. Category: Debt service on securitized funds; Fiscal Year 2004: MSA payments allocated: 17.9%; Fiscal Year 2004: Securitized proceeds allocated: 0.0%; Fiscal Year 2004: Total allocated: 8.7%; Fiscal Year 2005: MSA payments expected to be allocated: 25.4%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.0%; Fiscal Year 2005: Total expected to be allocated: 23.4%. Category: Economic development for tobacco regions; Fiscal Year 2004: MSA payments allocated: 5.2%; Fiscal Year 2004: Securitized proceeds allocated: 0.0%; Fiscal Year 2004: Total allocated: 2.5%; Fiscal Year 2005: MSA payments expected to be allocated: 5.1%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.0%; Fiscal Year 2005: Total expected to be allocated: 4.7%. Category: Education; Fiscal Year 2004: MSA payments allocated: 5.0%; Fiscal Year 2004: Securitized proceeds allocated: 0.0%; Fiscal Year 2004: Total allocated: 2.4%; Fiscal Year 2005: MSA payments expected to be allocated: 5.1%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.5%; Fiscal Year 2005: Total expected to be allocated: 4.8%. Category: General purposes; Fiscal Year 2004: MSA payments allocated: 13.3%; Fiscal Year 2004: Securitized proceeds allocated: 0.1%; Fiscal Year 2004: Total allocated: 6.5%; Fiscal Year 2005: MSA payments expected to be allocated: 12.0%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.5%; Fiscal Year 2005: Total expected to be allocated: 11.1%. Category: Health; Fiscal Year 2004: MSA payments allocated: 39.6%; Fiscal Year 2004: Securitized proceeds allocated: 0.9%; Fiscal Year 2004: Total allocated: 19.8%; Fiscal Year 2005: MSA payments expected to be allocated: 33.3%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 11.7%; Fiscal Year 2005: Total expected to be allocated: 31.6%. Category: Infrastructure; Fiscal Year 2004: MSA payments allocated: 0.7%; Fiscal Year 2004: Securitized proceeds allocated: 12.3%; Fiscal Year 2004: Total allocated: 6.6%; Fiscal Year 2005: MSA payments expected to be allocated: 3.0%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.0%; Fiscal Year 2005: Total expected to be allocated: 2.7%. Category: Payments to tobacco growers; Fiscal Year 2004: MSA payments allocated: 0.4%; Fiscal Year 2004: Securitized proceeds allocated: 0.0%; Fiscal Year 2004: Total allocated: 0.2%; Fiscal Year 2005: MSA payments expected to be allocated: 0.5%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.0%; Fiscal Year 2005: Total expected to be allocated: 0.4%. Category: Reserves/Rainy day funds; Fiscal Year 2004: MSA payments allocated: 0.3%; Fiscal Year 2004: Securitized proceeds allocated: 0.0%; Fiscal Year 2004: Total allocated: 0.1%; Fiscal Year 2005: MSA payments expected to be allocated: 0.3%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.0%; Fiscal Year 2005: Total expected to be allocated: 0.3%. Category: Social services; Fiscal Year 2004: MSA payments allocated: 2.6%; Fiscal Year 2004: Securitized proceeds allocated: 0.0%; Fiscal Year 2004: Total allocated: 1.2%; Fiscal Year 2005: MSA payments expected to be allocated: 2.5%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.0%; Fiscal Year 2005: Total expected to be allocated: 2.3%. Category: Tax reductions; Fiscal Year 2004: MSA payments allocated: 1.0%; Fiscal Year 2004: Securitized proceeds allocated: 0.0%; Fiscal Year 2004: Total allocated: 0.5%; Fiscal Year 2005: MSA payments expected to be allocated: 0.0%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.0%; Fiscal Year 2005: Total expected to be allocated: 0.0%. Category: Tobacco control; Fiscal Year 2004: MSA payments allocated: 3.9%; Fiscal Year 2004: Securitized proceeds allocated: 0.1%; Fiscal Year 2004: Total allocated: 2.0%; Fiscal Year 2005: MSA payments expected to be allocated: 4.8%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 1.1%; Fiscal Year 2005: Total expected to be allocated: 4.5%. Category: Unallocated; Fiscal Year 2004: MSA payments allocated: 3.1%; Fiscal Year 2004: Securitized proceeds allocated: 6.8%; Fiscal Year 2004: Total allocated: 5.0%; Fiscal Year 2005: MSA payments expected to be allocated: 2.9%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 0.0%; Fiscal Year 2005: Total expected to be allocated: 2.7%. Category: Total[A]; Fiscal Year 2004: MSA payments allocated: 99.9%; Fiscal Year 2004: Securitized proceeds allocated: 100.0%; Fiscal Year 2004: Total allocated: 99.8%; Fiscal Year 2005: MSA payments expected to be allocated: 100.1%; Fiscal Year 2005: Securitized proceeds expected to be allocated: 100.0%; Fiscal Year 2005: Total expected to be allocated: 99.9%. Category: Total amount allocated[B]; Fiscal Year 2004: MSA payments allocated: $5,576,588,405; Fiscal Year 2004: Securitized proceeds allocated: $5,855,998,723; Fiscal Year 2004: Total allocated: $11,432,587,128; Fiscal Year 2005: MSA payments expected to be allocated: $5,534,150,369; Fiscal Year 2005: Securitized proceeds expected to be allocated: $463,792,236; Fiscal Year 2005: Total expected to be allocated: $5,997,942,605. Sources: State budget offices or their designees (data); GAO (analysis). [A] May not equal 100 percent due to rounding. [B] Some states received MSA payments and/or securitized proceeds in one fiscal year and allocated them the next fiscal year. The amount of funds allocated may not equal the amount of funds received because of carry-over funds and interest earned. [End of table] Tables 4 and 5 show the percentage of the combined MSA payments and securitized proceeds that individual states allocated, and expect to allocate, to various categories in fiscal years 2004 and 2005, respectively. Table 4: Allocation of States' Combined MSA Payments and Securitized Proceeds, Fiscal Year 2004: State: Alabama; Budget shortfalls: 0.00%; Debt on securitized proceeds: 12.8%; Economic development for tobacco regions: 0.0%; Education: 11.5%; General purposes: 7.4%; Health: 43.1%; Infrastructure: 0.0%; Payments to tobacco growers: 0.0%; Reserves/Rainy day funds: 0.0%; Social services: 24.7%; Tax reductions: 0.0%; Tobacco control: 0.5%; Unallocated: 0.0%. State: Alaska; Debt on securitized proceeds: 80%; Health: 4%; Infrastructure: 0%; Tobacco control: 16%. State: Arizona; Health: 100%. State: Arkansas; Debt on securitized proceeds: 9.5%; Education: 4.7%; Health: 84.3%; Tobacco control: 1.5%. State: California; Debt on securitized proceeds: 100%. State: Colorado; Education: 22.8%; Health: 65.5%; Social services: 3.8%; Tobacco control: 7.9%. State: Connecticut; General purposes: 100%. State: Delaware; Education: 5.2%; General purposes: 0.7%; Health: 72.2%; Social services: 1.7%; Tobacco control: 20.3%. State: Georgia; Economic development for tobacco regions: 37.8%; Health: 51%; Social services: 4.1%; Tobacco control: 7.2%. State: Hawaii; General purposes: 7.2%; Health: 32.5%; Infrastructure: 26%; Reserves/Rainy day funds: 22.7%; Tobacco control: 11.6%. State: Idaho; Health: 3.7%; Social services: 1.2%; Tobacco control: 5.8%; Unallocated: 89.3%. State: Illinois; Education: 5.2%; General purposes: 13.1%; Health: 59.6%; Infrastructure: 1%; Social services: 0.3%; Tax reductions: 18.3%; Tobacco control: 2.5%. State: Indiana; Economic development for tobacco regions: 27.2%; Health: 51.2%; Infrastructure: 0.9%; Social services: 14.3%; Tobacco control: 6.4%. State: Iowa; Debt on securitized proceeds: 36.1%; Education: 1.8%; General purposes: 1.8%; Health: 56%; Tobacco control: 4.3%. State: Kansas; Education: 15.9%; General purposes: 20.5%; Health: 3.3%; Social services: 60.3%. State: Kentucky; Economic development for tobacco regions: 39.7%; Education: 5.4%; General purposes: 0.3%; Health: 39.8%; Infrastructure: 10.2%; Tobacco control: 4.5%. State: Louisiana; Debt on securitized proceeds: 60%; General purposes: 0.2%; Health: 8.4%; Social services: 1.1%; Tobacco control: 0.4%; Unallocated: 30%. State: Maine; Budget shortfalls: 11.7%; Education: 17.9%; General purposes: 0.1%; Health: 34.3%; Social services: 10.2%; Tobacco control: 25.7%. State: Maryland; Education: 1.4%; General purposes: 13.9%; Health: 71.1%; Payments to tobacco growers: 2.4%; Tobacco control: 6.4%; Unallocated: 4.8%. State: Massachusetts; General purposes: 100%. State: Michigan; Budget shortfalls: 22.4%; Education: 36.7%; General purposes: 0.1%; Health: 37.6%; Unallocated: 3.2%. State: Missouri; Budget shortfalls: 48.7%; General purposes: 3%; Health: 48%; Tobacco control: 0.3%. State: Montana; General purposes: 11%; Health: 68.4%; Social services: 8.1%; Tobacco control: 9.4%; Unallocated: 3.1%. State: Nebraska; General purposes: 0.2%; Health: 55.5%; Social services: 7.4%; Unallocated: 36.9%. State: Nevada; Education: 50.8%; General purposes: 0.4%; Health: 24.6%; Social services: 15.5%; Tobacco control: 8.7%. State: New Hampshire; Education: 95.7%; General purposes: 4.3%. State: New Jersey; Budget shortfalls: 50.7%; Debt on securitized proceeds: 7%; Health: 7.1%; Infrastructure: 35.3%. State: New Mexico; Education: 2.1%; Health: 97.9%. State: New York; Budget shortfalls: 83.5%; Health: 7.1%; Tobacco control: 0.7%; Unallocated: 8.8%. State: North Carolina; Economic development for tobacco regions: 50%; General purposes: 41.6%; Health: 1.3%; Tobacco control: 7.1%. State: North Dakota; Education: 45%; Health: 2.1%; Infrastructure: 45%; Tobacco control: 7.9%. State: Ohio; Budget shortfalls: 72.9%; Economic development for tobacco regions: 4.7%; Education: 2.3%; General purposes: 0.2%; Health: 11.6%; Infrastructure: 1.6%; Social services: 1.2%; Tobacco control: 5.4%. State: Oklahoma; General purposes: 2.2%; Health: 47.6%; Social services: 24%; Tobacco control: 26.2%. State: Oregon; Debt on securitized proceeds: 4.2%; Health: 8%; Infrastructure: 60.3%; Unallocated: 27.4%. State: Pennsylvania; Health: 100%. State: Rhode Island; Debt on securitized proceeds: 95.6%; General purposes: 4.4%. State: South Carolina; Debt on securitized proceeds: 100%. State: South Dakota; Debt on securitized proceeds: 60.7%; Education: 39.3%. State: Tennessee; General purposes: 100%. State: Utah; Budget shortfalls: 28.4%; General purposes: 0.3%; Health: 37.6%; Reserves/Rainy day funds: 16.2%; Social services: 5.8%; Tobacco control: 11.7%. State: Vermont; General purposes: 1.6%; Health: 70%; Social services: 11.7%; Tobacco control: 16.7%. State: Virginia; Economic development for tobacco regions: 34.9%; General purposes: 40%; Payments to tobacco growers: 15.1%; Tobacco control: 10%. State: Washington; Debt on securitized proceeds: 25.7%; Health: 62.3%; Tobacco control: 12.1%. State: West Virginia; Health: 39.5%; Tobacco control: 10.5%; Unallocated: 50%. State: Wisconsin; Debt on securitized proceeds: 100%. State: Wyoming; Health: 46.8%; Social services: 26%; Tobacco control: 27.1%. Total; Budget shortfalls: 44.30%; Debt on securitized proceeds: 8.70%; Economic development for tobacco regions: 2.50%; Education: 2.40%; General purposes: 6.50%; Health: 19.80%; Infrastructure: 6.60%; Payments to tobacco growers: 0.20%; Reserves/Rainy day funds: 0.10%; Social services: 1.20%; Tax reductions: 5.00%; Tobacco control: 2.00%; Unallocated: 5.00%. Sources: State budget offices and their designees (data); GAO (analysis). Note: Percentages may not add up to 100 because of rounding. Appendix IV shows the dollar amount each state allocated to the various categories. [End of table] Table 5: Expected Allocation of States' Combined MSA Payments and Securitized Proceeds, Fiscal Year 2005: State: Alabama; Budget shortfalls: 0.00%; Debt on securitized funds: 13.50%; Economic development for tobacco regions: 0.00%; Education: 11.40%; General purposes: 7.30%; Health: 42.70%; Infrastructure: 0.00%; Payments to tobacco growers: 0.00%; Reserves/Rainy day funds: 0.00%; Social services: 24.50%; Tax reductions: 0.00%; Tobacco control: 0.50%.00%. State: Alaska; Debt on securitized funds: 80%; Health: 4.8%; Tobacco control: 15.2%. State: Arizona; Health: 100%. State: Arkansas; Debt on securitized funds: 10%; Education: 4.7%; Health: 83.7%; Tobacco control: 1.6%. State: California ; Debt on securitized funds: 100%. State: Colorado; Budget shortfalls: 29.2%; Education: 18.5%; Health: 40.4%; Infrastructure: 2.1%; Social services: 4.9%; Tobacco control: 4.9%. State: Connecticut; General purposes: 100%. State: Delaware; Education: 6.3%; General purposes: 0.7%; Health: 71.9%; Social services: 1.6%; Tobacco control: 19.4%. State: Georgia; Economic development for tobacco regions: 30.1%; Health: 57.1%; Social services: 4.6%; Tobacco control: 8.2%. State: Hawaii; General purposes: 7.2%; Health: 32.5%; Infrastructure: 26%; Reserves/Rainy day funds: 22.7%; Tobacco control: 11.6%. State: Idaho; Health: 2.1%; Social services: 1.1%; Tobacco control: 4.9%; Unallocated: 91.9%. State: Illinois; Education: 4.6%; General purposes: 8.7%; Health: 80.3%; Infrastructure: 1.7%; Social services: 0.4%; Tobacco control: 4.3%. State: Indiana; Economic development for tobacco regions: 26.9%; Health: 51.9%; Infrastructure: 0.8%; Social services: 14.1%; Tobacco control: 6.3%. State: Iowa; Debt on securitized funds: 36.2%; Education: 1.8%; General purposes: 1.9%; Health: 55.9%; Tobacco control: 4.3%. State: Kansas; Education: 14.9%; General purposes: 8.9%; Health: 3.1%; Social services: 73.1%. State: Kentucky; Economic development for tobacco regions: 44.4%; Education: 10.1%; Health: 35.4%; Infrastructure: 5.6%; Tobacco control: 4.5%. State: Louisiana; Debt on securitized funds: 60%; General purposes: 0.2%; Health: 9.4%; Tobacco control: 0.3%; Unallocated: 30%. State: Maine; Education: 21.6%; General purposes: 0.1%; Health: 37.5%; Social services: 11.3%; Tobacco control: 29.5%. State: Maryland; Education: 2%; General purposes: 19.7%; Health: 64.2%; Payments to tobacco growers: 3.7%; Tobacco control: 6.2%; Unallocated: 4.2%. State: Massachusetts; General purposes: 100%. State: Michigan; Budget shortfalls: 2.4%; Education: 34.4%; General purposes: 0.1%; Health: 62.9%; Tobacco control: 0.2%. State: Missouri; Budget shortfalls: 49.1%; General purposes: 1.7%; Health: 48.9%; Tobacco control: 0.3%. State: Montana; General purposes: 10.7%; Health: 68.8%; Social services: 9.6%; Tobacco control: 11%. State: Nebraska; General purposes: 0.2%; Health: 57.1%; Social services: 7.7%; Tobacco control: 0%; Unallocated: 35%. State: Nevada; Education: 56.5%; General purposes: 0.4%; Health: 22.3%; Social services: 12.8%; Tobacco control: 8%. State: New Hampshire; Education: 100%. State: New Jersey; Debt on securitized funds: 100%. State: New Mexico; Education: 2.3%; General purposes: 36.4%; Health: 61.3%. State: New York; Budget shortfalls: 72.2%; Debt on securitized funds: 27.8%. State: North Carolina; Economic development for tobacco regions: 53%; General purposes: 36.7%; Health: 2.6%; Infrastructure: 1.2%; Tobacco control: 6.6%. State: North Dakota; Education: 45%; Health: 2.1%; Infrastructure: 45%; Tobacco control: 7.9%. State: Ohio; Economic development for tobacco regions: 4.3%; Education: 2.1%; General purposes: 0.3%; Health: 11.8%; Infrastructure: 43.2%; Social services: 1.3%; Tobacco control: 36.9%. State: Oklahoma; General purposes: 2%; Health: 69.5%; Tobacco control: 28.4%. State: Oregon; Debt on securitized funds: 35.5%; Health: 22.4%; Tobacco control: 0.6%; Unallocated: 41.5%. State: Pennsylvania; Health: 100%. State: Rhode Island; Debt on securitized funds: 100%. State: South Carolina; Debt on securitized funds: 100%. State: South Dakota; Debt on securitized funds: 61.7%; Education: 36.3%; Tobacco control: 2%. State: Tennessee; General purposes: 100%. State: Utah; General purposes: 0.4%; Health: 47.7%; Reserves/Rainy day funds: 29.7%; Social services: 7.3%; Tobacco control: 15%. State: Vermont; General purposes: 1.4%; Health: 64.1%; Social services: 16.8%; Tobacco control: 17.7%. State: Virginia; Economic development for tobacco regions: 35%; Health: 38.6%; Payments to tobacco growers: 16.2%; Tobacco control: 10.2%. State: Washington; Debt on securitized funds: 29.2%; Health: 70.8%. State: West Virginia; Health: 38.5%; Tobacco control: 11.5%; Unallocated: 50%. State: Wisconsin; Debt on securitized funds: 100%. State: Wyoming; General purposes: 0.8%; Health: 46.8%; Social services: 25.2%; Tobacco control: 27.1%. Total; Budget shortfalls: 11.4%; Debt on securitized funds: 23.4%; Economic development for tobacco regions: 4.7%; Education: 4.8%; General purposes: 11.1%; Health: 31.6%; Infrastructure: 2.7%; Payments to tobacco growers: 0.4%; Reserves/Rainy day funds: 0.3%; Social services: 2.3%; Tax reductions: 0.0%; Tobacco control: 4.5%; Unallocated: 2.7%. Sources: State budget offices and their designees (data); GAO (analysis). Note: Percentages may not add up to 100 because of rounding. Appendix IV shows the dollar amount each state allocated to the various categories. [End of table] We are sending copies of this report to interested congressional committees and to others upon request. Copies are also available at no charge on the GAO Web site at [Hyperlink, http://www.gao.gov]. Please contact me at (202) 512-3841 or [Hyperlink, robinsonr@gao.gov] if you or your staff have any questions concerning this report. Major contributors to this report are listed in appendix VI. Signed by: Robert A. Robinson: Managing Director, Natural Resources and Environment: List of Congressional Requesters: The Honorable Saxby Chambliss: Chairman: The Honorable Tom Harkin: Ranking Democratic Member: Committee on Agriculture, Nutrition, and Forestry: United States Senate: The Honorable Robert Goodlatte: Chairman, Committee on Agriculture: House of Representatives: The Honorable Jim Bunning: United States Senate: [End of section] Appendixes: Appendix I Objectives, Scope, and Methodology: The Farm Security and Rural Investment Act of 2002 (2002 Farm Bill) requires GAO to report annually on the amount of Master Settlement Agreement (MSA) payments that states receive and on how they use these payments for the years 2002 through 2006. This report is the fourth in a series of reports responding to the 2002 Farm Bill requirement. In December 2002, we issued the report Tobacco Settlement: States' Allocations of Phase II Funds [Hyperlink, http://www.gao.gov/cgi- bin/getrpt?GAO-03-262R], which provides information on the National Tobacco Grower Settlement Trust (commonly referred to as the Phase II agreement). In February 2003, we issued the report Tobacco Settlement: States' Allocations of Fiscal Years 2002 and 2003 Master Settlement Agreement Payments [Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-03- 407]). In March 2004, we issued the report Tobacco Settlement: States' Allocations of Fiscal Year 2003 and Expected Fiscal Year 2004 Payments [Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-518]). We also reported on states' receipt and use of MSA payments for fiscal years 2000 and 2001 in a June 2001 report, Tobacco Settlement: States' Use of Master Settlement Agreement Payments [Hyperlink, http://www.gao.gov/cgi- bin/getrpt?GAO-01-851]. To respond to the 2002 Farm Bill requirement, the objectives of this study were to provide information on (1) the amount of payments received by the 46 states party to the MSA during fiscal year 2004, and the amount of payments these states expect to receive during fiscal year 2005, and (2) states' allocations of MSA funds to various program categories for fiscal year 2004 and states' expected allocations for fiscal year 2005.[Footnote 14],[Footnote 15] To address these objectives, we surveyed[Footnote 16] the executive budget offices, or their designees, in the 46 states party to the MSA. In addition, we performed some data reliability testing and independently corroborated these data to the extent possible. We obtained and reviewed MSA disbursement data provided by the National Association of Attorneys General[Footnote 17] and compared it with payment data provided by the states. We contacted state officials to discuss any data entries on the surveys that were questionable, and we resolved all discrepancies between the survey data and the data provided by the National Association of Attorneys General. We also reviewed previous GAO reports and other relevant studies by organizations such as the National Conference of State Legislatures. Finally, we contacted the National Association of State Budget Officers to request their assistance in encouraging state officials to respond to our survey. We conducted our work from July 2004 through February 2005 in accordance with generally accepted government auditing standards. Our study focuses on the states' shares of MSA payments and does not include information on allocations of MSA payments to cities and counties in California and New York.[Footnote 18] In addition, we did not collect information on MSA payments made to the District of Columbia or the five U.S. territories that are also party to the MSA. Because we completed our fieldwork before states received their fiscal year 2005 payments, we were unable to obtain final information on the actual MSA payments states received during fiscal year 2005. Consequently, we obtained information on states' expected fiscal year 2005 MSA payments. Survey Methodology and Categorization of States' Allocations: We used a survey instrument somewhat similar to the one used to obtain information for our March 2004 report. In July 2004, we contacted the 46 state budget officials, or their designees, who completed the surveys for our March 2004 report. The officials in most of these states indicated they would be the respondents for this year's survey; a few identified new respondents. In August 2004, we e-mailed the survey to the identified officials in each of the 46 states party to the MSA. We received responses from all 46 states. From these responses, we obtained information on (1) the MSA payments states received in fiscal year 2004 and the MSA payments they expect to receive in fiscal year 2005 and (2) the states' allocations and expected allocations of MSA payments in fiscal years 2004 and 2005, respectively. We also obtained information on the states' proceeds, if any, from securitization or expected securitization in fiscal years 2004 and 2005, respectively, and the allocation of the securitized proceeds. Furthermore, in the survey, we asked the states to categorize their allocations of MSA payments and securitized MSA proceeds for fiscal years 2004 and 2005, using the 13 program categories developed for our report. (See below for the definitions of the 13 categories.) The level of detail for individual states varies because we relied on state-reported information. We performed some reliability testing and independently corroborated, to the extent possible, the accuracy of the information provided to us by the state budget offices. We reviewed earlier reports, compared payment amounts reported by states with amounts reported to the National Association of Attorneys General, and contacted many states to clarify the information they provided. On the basis of this work, we determined that these data were reliable enough for our purposes. In addition, there are no sampling errors because this was not a sample survey. Nevertheless, the practical difficulties of conducting any survey may introduce errors, commonly referred to as nonsampling errors. For example, difficulties in how a particular question is interpreted, in the sources of information that are available to respondents, or in how the data are entered into a database or were analyzed can introduce unwanted variability into the survey results. We took steps in the development of the survey, the data collection, and the data editing and analysis to minimize these nonsampling errors. For example, we edited the completed surveys for consistency and contacted state budget offices to clarify responses, verified all survey data that were entered into our database, and verified that the computer programs were written correctly. We took information on MSA payments and securitized proceeds received and allocated for fiscal years 2000 through 2003 that we collected for previous GAO reports dealing with the MSA[Footnote 19] and compared it with receipts and allocations for fiscal years 2004 and 2005. Categories of States' Allocations: Budget shortfalls: This category is comprised of amounts allocated to balance state budgets and close gaps or reduce deficits resulting from lower than anticipated revenues or increased mandatory or essential expenditures. Debt service on securitized funds: This category consists of amounts allocated to service the debt on bonds issued when the state securitized all or a portion of its MSA payments. Economic development for tobacco regions: This category is comprised of amounts allocated for economic development projects in tobacco states, such as infrastructure projects, education and job training programs, and research on alternative uses of tobacco and alternative crops. This category includes projects specifically designed to benefit tobacco growers as well as economic development that may serve a larger population within a tobacco state. Education: This category is comprised of amounts allocated for education programs such as day care, preschool, Head Start, early childhood education, elementary and secondary education, after-school programs, and higher education. This category does not include money for capital projects such as construction of school buildings. General purposes: This category is comprised of amounts allocated for attorneys' fees and other items, such as law enforcement or community development, that could not be placed into a more precise category. This category also includes amounts allocated to a state's general fund that were not earmarked for any particular purpose. Amounts used to balance state budgets and close gaps or reduce deficits should be categorized as budget shortfalls, rather than as general purposes. Health: This category is comprised of amounts allocated for direct health care services; health insurance, including Medicaid and the State Children's Health Insurance Program; hospitals; medical technology; public health services; and health research. This category does not include money for capital projects such as construction of health facilities. Infrastructure: This category is comprised of amounts allocated for capital projects such as construction and renovation of health-care, education and social services facilities; water and transportation projects; and municipal and state government buildings. This category includes retirement of debt owed on capital projects. Payments to tobacco growers: This category is comprised of amounts allocated for direct payments to tobacco growers, including subsidies and crop conversion programs. Reserves/Rainy day funds: This category is comprised of amounts allocated to state budget reserves such as rainy day and budget stabilization funds not earmarked for specific programs. Amounts allocated to reserves that are earmarked for specific areas are categorized under those areas--for example, reserve amounts earmarked for economic development purposes should be categorized in the economic development category. Social services: This category is comprised of amounts allocated for social services, such as programs for the aging, assisted living, Meals on Wheels, drug courts, child welfare, and foster care. This category also includes amounts allocated to special funds established for children's programs. Tax reductions: This category is comprised of amounts allocated for tax reductions such as property tax rebates and earned income tax credits. Tobacco control: This category is comprised of amounts allocated for tobacco control programs such as prevention, including youth education, enforcement, and cessation services. Unallocated: This category is comprised of amounts not allocated for any specific purpose, such as amounts allocated to dedicated funds that have no specified purpose; amounts states chose not to allocate in the year MSA payments were received that will be available for allocation in a subsequent fiscal year; interest earned from dedicated funds not yet allocated; and amounts that have not been allocated because the state had not made a decision on the use of the MSA payments. [End of section] Appendix II: Allocations of MSA Payments for 46 States: State: Alabama; Percent: 1.6161308%. State: Alaska; Percent: 0.3414187%. State: Arizona; Percent: 1.4738845%. State: Arkansas; Percent: 0.8280661%. State: California; Percent: 12.7639554%. State: Colorado; Percent: 1.3708614%. State: Connecticut; Percent: 1.8565373%. State: Delaware; Percent: 0.3954695%. State: Georgia; Percent: 2.4544575%. State: Hawaii; Percent: 0.6018650%. State: Idaho; Percent: 0.3632632%. State: Illinois; Percent: 4.6542472%. State: Indiana; Percent: 2.0398033%. State: Iowa; Percent: 0.8696670%. State: Kansas; Percent: 0.8336712%. State: Kentucky; Percent: 1.7611586%. State: Louisiana; Percent: 2.2553531%. State: Maine; Percent: 0.7693505%. State: Maryland; Percent: 2.2604570%. State: Massachusetts; Percent: 4.0389790%. State: Michigan; Percent: 4.3519476%. State: Missouri; Percent: 2.2746011%. State: Montana; Percent: 0.4247591%. State: Nebraska; Percent: 0.5949833%. State: Nevada; Percent: 0.6099351%. State: New Hampshire; Percent: 0.6659340%. State: New Jersey; Percent: 3.8669963%. State: New Mexico; Percent: 0.5963897%. State: New York; Percent: 12.7620310%. State: North Carolina; Percent: 2.3322850%. State: North Dakota; Percent: 0.3660138%. State: Ohio; Percent: 5.0375098%. State: Oklahoma; Percent: 1.0361370%. State: Oregon; Percent: 1.1476582%. State: Pennsylvania; Percent: 5.7468588%. State: Rhode Island; Percent: 0.7189054%. State: South Carolina; Percent: 1.1763519%. State: South Dakota; Percent: 0.3489458%. State: Tennessee; Percent: 2.4408945%. State: Utah; Percent: 0.4448869%. State: Vermont; Percent: 0.4111851%. State: Virginia; Percent: 2.0447451%. State: Washington; Percent: 2.0532582%. State: West Virginia; Percent: 0.8864604%. State: Wisconsin; Percent: 2.0720390%. State: Wyoming; Percent: 0.2483449. Sources: [Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-518] and the Master Settlement Agreement. [End of table] [End of section] Appendix III: States' Allocations of Combined MSA Payments and Securitized Proceeds for Fiscal Years 2000 through 2005: Dollars in millions (current year dollars) and percent[A]. Budget shortfalls; Fiscal year 2000-01: Allocation: [A]; Fiscal year 2000-01: Percentage: [A]; Fiscal year 2002: Allocation: $2,448; Fiscal year 2002: Percentage: 20%; Fiscal year 2003: Allocation: $5,038; Fiscal year 2003: Percentage: 36%; Fiscal year 2004: Allocation: $5,059; Fiscal year 2004: Percentage: 44%; Fiscal year 2005 (expected): Allocation: $686; Fiscal year 2005 (expected): Percentage: 11%. Debt service on securitized funds; Fiscal year 2000-01: Allocation: [A]; Fiscal year 2000- 01: Percentage: [A]; Fiscal year 2002: Allocation: $271; Fiscal year 2002: Percentage: 2%; Fiscal year 2003: Allocation: $339; Fiscal year 2003: Percentage: 2%; Fiscal year 2004: Allocation: $998; Fiscal year 2004: Percentage: 9%; Fiscal year 2005 (expected): Allocation: $1,405; Fiscal year 2005 (expected): Percentage: 23%. Economic development for tobacco regions; Fiscal year 2000-01: Allocation: $466; Fiscal year 2000-01: Percentage: 4%; Fiscal year 2002: Allocation: $218; Fiscal year 2002: Percentage: 2%; Fiscal year 2003: Allocation: $285; Fiscal year 2003: Percentage: 2%; Fiscal year 2004: Allocation: $291; Fiscal year 2004: Percentage: 3%; Fiscal year 2005 (expected): Allocation: $284; Fiscal year 2005 (expected): Percentage: 5%. Education; Fiscal year 2000-01: Allocation: $848; Fiscal year 2000-01: Percentage: 7%; Fiscal year 2002: Allocation: $1,132; Fiscal year 2002: Percentage: 9%; Fiscal year 2003: Allocation: $531; Fiscal year 2003: Percentage: 4%; Fiscal year 2004: Allocation: $280; Fiscal year 2004: Percentage: 2%; Fiscal year 2005 (expected): Allocation: $287; Fiscal year 2005 (expected): Percentage: 5%. General purposes; Fiscal year 2000-01: Allocation: $623; Fiscal year 2000-01: Percentage: 5%; Fiscal year 2002: Allocation: $684; Fiscal year 2002: Percentage: 6%; Fiscal year 2003: Allocation: $1,111; Fiscal year 2003: Percentage: 8%; Fiscal year 2004: Allocation: $747; Fiscal year 2004: Percentage: 7%; Fiscal year 2005 (expected): Allocation: $666; Fiscal year 2005 (expected): Percentage: 11%. Health; Fiscal year 2000-01: Allocation: $4,788; Fiscal year 2000-01: Percentage: 38; Fiscal year 2002: Allocation: $4,434; Fiscal year 2002: Percentage: 37%; Fiscal year 2003: Allocation: $3,455; Fiscal year 2003: Percentage: 24%; Fiscal year 2004: Allocation: $2,263; Fiscal year 2004: Percentage: 20%; Fiscal year 2005 (expected): Allocation: $1,898; Fiscal year 2005 (expected): Percentage: 32%. Infrastructure; Fiscal year 2000-01: Allocation: $294; Fiscal year 2000-01: Percentage: 2%; Fiscal year 2002: Allocation: $1,222; Fiscal year 2002: Percentage: 10%; Fiscal year 2003: Allocation: $1,044; Fiscal year 2003: Percentage: 7%; Fiscal year 2004: Allocation: $759; Fiscal year 2004: Percentage: 7%; Fiscal year 2005 (expected): Allocation: $164; Fiscal year 2005 (expected): Percentage: 3%. Payments to tobacco growers; Fiscal year 2000-01: Allocation: $235; Fiscal year 2000-01: Percentage: 2%; Fiscal year 2002: Allocation: $192; Fiscal year 2002: Percentage: 2%; Fiscal year 2003: Allocation: $43; Fiscal year 2003: Percentage: 0%; Fiscal year 2004: Allocation: $25; Fiscal year 2004: Percentage: 0%; Fiscal year 2005 (expected): Allocation: $26; Fiscal year 2005 (expected): Percentage: 0%. Reserves/Rainy day funds; Fiscal year 2000-01: Allocation: $603; Fiscal year 2000-01: Percentage: 5%; Fiscal year 2002: Allocation: $124; Fiscal year 2002: Percentage: 1%; Fiscal year 2003: Allocation: $24; Fiscal year 2003: Percentage: 0%; Fiscal year 2004: Allocation: $14; Fiscal year 2004: Percentage: 0%; Fiscal year 2005 (expected): Allocation: $18; Fiscal year 2005 (expected): Percentage: 0%. Social services; Fiscal year 2000-01: Allocation: $231; Fiscal year 2000-01: Percentage: 2%; Fiscal year 2002: Allocation: $278; Fiscal year 2002: Percentage: 2%; Fiscal year 2003: Allocation: $160; Fiscal year 2003: Percentage: 1%; Fiscal year 2004: Allocation: $142; Fiscal year 2004: Percentage: 1%; Fiscal year 2005 (expected): Allocation: $136; Fiscal year 2005 (expected): Percentage: 2%. Tax reductions; Fiscal year 2000-01: Allocation: $416; Fiscal year 2000-01: Percentage: 3%; Fiscal year 2002: Allocation: $35; Fiscal year 2002: Percentage: 0%; Fiscal year 2003: Allocation: $109; Fiscal year 2003: Percentage: 1%; Fiscal year 2004: Allocation: $56; Fiscal year 2004: Percentage: 1%; Fiscal year 2005 (expected): Allocation: $0; Fiscal year 2005 (expected): Percentage: 0%. Tobacco control; Fiscal year 2000-01: Allocation: $790; Fiscal year 2000-01: Percentage: 6%; Fiscal year 2002: Allocation: $375; Fiscal year 2002: Percentage: 3%; Fiscal year 2003: Allocation: $276; Fiscal year 2003: Percentage: 2%; Fiscal year 2004: Allocation: $223; Fiscal year 2004: Percentage: 2%; Fiscal year 2005 (expected): Allocation: $268; Fiscal year 2005 (expected): Percentage: 5%. Unallocated; Fiscal year 2000-01: Allocation: $3,217; Fiscal year 2000-01: Percentage: 26%; Fiscal year 2002: Allocation: $584; Fiscal year 2002: Percentage: 5%; Fiscal year 2003: Allocation: $1,720; Fiscal year 2003: Percentage: 12%; Fiscal year 2004: Allocation: $575; Fiscal year 2004: Percentage: 5%; Fiscal year 2005 (expected): Allocation: $161; Fiscal year 2005 (expected): Percentage: 3%. Total; Fiscal year 2000-01: Allocation: $12,511; Fiscal year 2000-01: Percentage: 100%; Fiscal year 2002: Allocation: $11,998; Fiscal year 2002: Percentage: 99%; Fiscal year 2003: Allocation: $14,135; Fiscal year 2003: Percentage: 99%; Fiscal year 2004: Allocation: $11,432; Fiscal year 2004: Percentage: 101%; Fiscal year 2005 (expected): Allocation: $5,998; Fiscal year 2005 (expected): Percentage: 100%. Sources: [Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-518] and state budget offices or their designees (data); GAO (analysis). Note: Percentages and totals may not add up due to rounding. The amounts for each year are in the current year dollars for that year. Percentages across years may be compared but not dollars across years because the dollars are not adjusted to a constant base year. [A] We did not obtain information on allocations for budget shortfalls and debt service on securitized funds in fiscal years 2000 and 2001. [End of table] [End of section] Appendix IV: State-Specific Information on Amounts of Master Settlement Agreement Payments and Securitized Proceeds Received and Allocated: This appendix presents the following information for each of the 46 states that are party to the MSA: * the amount of MSA payments received and the categories to which they were allocated for fiscal year 2004; * the amount of MSA payments expected to be received and the expected categories to which they will be allocated for fiscal year 2005; and: * the amount of securitized proceeds received or expected to be received and the categories to which they were allocated or expected to be allocated for fiscal years 2004 and 2005, respectively, if applicable (applies to 5 states). Tables 6 through 51 include only those program categories to which a state reported allocating funds. If a category is not listed, it means the state did not allocate funds to the category. In some cases, the total amounts allocated may exceed the actual MSA payments and securitized proceeds because the amounts allocated include carry-over funds from prior years and/or the interest earned on those funds. Some states that allocated funds to a program category did not provide examples of programs receiving funds. Only 5 states--Iowa, New Jersey, New York, Oregon, and Rhode Island--received or expected to receive, or allocated or expected to allocate, securitized proceeds in fiscal year 2004 or 2005, respectively. In those cases, we combined securitized proceeds with MSA payments before allocating the funds to categories. Alabama: Alabama reported receiving $101,871,680 from MSA payments in fiscal year 2004 and expects to receive $96,000,000 in fiscal year 2005. Table 6: Alabama's MSA Payment Allocations: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $13,000,000; Fiscal year 2005 expected allocation: $13,000,000. Program area: Education; Fiscal year 2004 allocation: $11,675,188; Fiscal year 2005 expected allocation: $10,903,817; Examples of programs receiving or expected to receive allocations: Alternative schools. Program area: General purposes; Fiscal year 2004 allocation: $7,524,430; Fiscal year 2005 expected allocation: $7,027,298; Examples of programs receiving or expected to receive allocations: Juvenile Probation Officers, Administration, Forensic Sciences. Program area: Health; Fiscal year 2004 allocation: $43,933,579; Fiscal year 2005 expected allocation: $41,030,925; Examples of programs receiving or expected to receive allocations: Public Health, mental health, Medicaid, senior services. Program area: Social services; Fiscal year 2004 allocation: $25,207,792; Fiscal year 2005 expected allocation: $23,542,332; Examples of programs receiving or expected to receive allocations: Child welfare, Children's programs, Youth services. Program area: Tobacco control; Fiscal year 2004 allocation: $530,690; Fiscal year 2005 expected allocation: $495,628; Examples of programs receiving or expected to receive allocations: Tobacco enforcement on minors. Total; Fiscal year 2004 allocation: $101,871,679; Fiscal year 2005 expected allocation: $96,000,000. Source: Alabama Executive Budget Office. [End of table] Alaska: Alaska reported receiving $21,438,845 from MSA payments in fiscal year 2004 and expects to receive $23,347,500 in fiscal year 2005. Table 7: Alaska's MSA Payment Allocations: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $17,151,076; Fiscal year 2005 expected allocation: $18,678,000. Program area: Health; Fiscal year 2004 allocation: $857,554; Fiscal year 2005 expected allocation: $1,111,500; Examples of programs receiving or expected to receive allocations: Medicaid and public health. Program area: Tobacco control; Fiscal year 2004 allocation: $3,430,215; Fiscal year 2005 expected allocation: $3,558,000; Examples of programs receiving or expected to receive allocations: Sting operations. Total; Fiscal year 2004 allocation: $21,438,845; Fiscal year 2005 expected allocation: $23,347,500. Source: Alaska Office of Management and Budget. Arizona: Arizona reported receiving $92,648,165 from MSA payments in fiscal year 2004 and expects to receive $90,304,100 in fiscal year 2005. Table 8: Arizona's MSA Payment Allocation: Program area: Health; Fiscal year 2004 allocation: $92,648,165; Fiscal year 2005 expected allocation: $90,304,100. Total; Fiscal year 2004 allocation: $92,648,165; Fiscal year 2005 expected allocation: $90,304,100. Source: Arizona Governor's Office of Strategic Planning and Budgeting. [End of table] Arkansas: Arkansas reported receiving $52,688,976 from MSA payments in fiscal year 2004 and expects to receive $50,000,000 in fiscal year 2005. Table 9: Arkansas's MSA Payment Allocations: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $5,000,000; Fiscal year 2005 expected allocation: $5,000,000. Program area: Education; Fiscal year 2004 allocation: $2,486,503; Fiscal year 2005 expected allocation: $2,346,300; Examples of programs receiving or expected to receive allocations: School of Public Health. Program area: Health; Fiscal year 2004 allocation: $44,391,493; Fiscal year 2005 expected allocation: $41,842,720; Examples of programs receiving or expected to receive allocations: Prevention and cessation, biomedical research, Medicaid, and Minority Health. Program area: Tobacco control; Fiscal year 2004 allocation: $810,980; Fiscal year 2005 expected allocation: $810,980; Examples of programs receiving or expected to receive allocations: Sales to Minors Enforcement. Total; Fiscal year 2004 allocation: $52,688,976; Fiscal year 2005 expected allocation: $50,000,000. Source: Arkansas Department of Finance and Administration. [End of table] California: California reported receiving $400,746,161 from MSA payments in fiscal year 2004 and expects to receive $404,500,000 in fiscal year 2005. Table 10: California's MSA Payment Allocation: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $400,746,161; Fiscal year 2005 expected allocation: $404,500,000. Total; Fiscal year 2004 allocation: $400,746,161; Fiscal year 2005 expected allocation: $404,500,000. Source: California Department of Finance. Note: These MSA payments include only payments made to the state, which amount to 50 percent of the annual payments made by the tobacco companies to California. Cities and counties in the state receive the other 50 percent of the annual MSA payments to California. [End of table] Colorado: Colorado reported receiving $87,037,529 from MSA payments in fiscal year 2004 and expects to receive $88,878,470 in fiscal year 2005. Table 11: Colorado's MSA Payment Allocations: Program area: Budget shortfalls; Fiscal year 2004 allocation: $0; Fiscal year 2005 expected allocation: $26,159,617. Program area: Education; Fiscal year 2004 allocation: $11,398,410; Fiscal year 2005 expected allocation: $16,592,664; Examples of programs receiving or expected to receive allocations: Literacy programs for elementary students, regional libraries, state council on the arts. Program area: Health; Fiscal year 2004 allocation: $32,665,516; Fiscal year 2005 expected allocation: $36,140,261; Examples of programs receiving or expected to receive allocations: Nurse home visitor's program, primary and preventive care grants, Children's Health Insurance Program+, breast and cervical cancer program, dental loan repayment, Medicaid mental health capitation, Child Mental Health Treatment Act. Program area: Infrastructure; Fiscal year 2004 allocation: $0; Fiscal year 2005 expected allocation: $1,900,000; Examples of programs receiving or expected to receive allocations: Fitzsimons Health Sciences Center at the University of Colorado. Program area: Social services; Fiscal year 2004 allocation: $1,902,681; Fiscal year 2005 expected allocation: $4,351,876; Examples of programs receiving or expected to receive allocations: State veteran's fund, legal services for victims of family violence, services to juveniles. Program area: Tobacco control; Fiscal year 2004 allocation: $3,939,029; Fiscal year 2005 expected allocation: $4,351,876; Examples of programs receiving or expected to receive allocations: Cessation and prevention grants. Total; Fiscal year 2004 allocation: $49,905,636; Fiscal year 2005 expected allocation: $89,496,294[A]. Source: Colorado Governor's Office of State Planning and Budgeting. [A] Amount includes carry-over funds and interest earned. [End of table] Connecticut: Connecticut reported receiving $116,578,313 from MSA payments in fiscal year 2004 and expects to receive $109,000,000 in fiscal year 2005. Table 12: Connecticut's MSA Payment Allocation: Program area: General purposes; Fiscal year 2004 allocation: $116,578,313; Fiscal year 2005 expected allocation: $109,000,000; Examples of programs receiving or expected to receive allocations: General fund revenue. Total; Fiscal year 2004 allocation: $116,578,313; Fiscal year 2005 expected allocation: $109,000,000. Source: Connecticut Office of Policy and Management, Fiscal and Program Policy Section. [End of table] Delaware: Delaware reported receiving $24,832,878 from MSA payments in fiscal year 2004 and expects to receive $26,100,000 in fiscal year 2005. Table 13: Delaware's MSA Payment Allocations: Program area: Education; Fiscal year 2004 allocation: $1,297,100; Fiscal year 2005 expected allocation: $1,655,200; Examples of programs receiving or expected to receive allocations: Scholarships for nursing students at community college and those working in state facilities. Program area: General purposes; Fiscal year 2004 allocation: $169,700; Fiscal year 2005 expected allocation: $169,700; Examples of programs receiving or expected to receive allocations: Health Care Commission staff; survey of school-age children on alcohol, drug, and tobacco use; establishment and support of health library network. Program area: Health; Fiscal year 2004 allocation: $18,070,200; Fiscal year 2005 expected allocation: $18,773,100; Examples of programs receiving or expected to receive allocations: Breast and cervical cancer screening, Senior Prescription Assistance Program, several cancer resource/support programs, defibrillators. Program area: Social services; Fiscal year 2004 allocation: $430,000; Fiscal year 2005 expected allocation: $430,000; Examples of programs receiving or expected to receive allocations: Attendant care services for persons living in the community with disabilities. Program area: Tobacco control; Fiscal year 2004 allocation: $5,072,000; Fiscal year 2005 expected allocation: $5,072,000; Examples of programs receiving or expected to receive allocations: Tobacco prevention, control, and enforcement (e.g., Quitline smoking cessation programs and advertising, undercover kids, enforcement agents). Total; Fiscal year 2004 allocation: $25,039,000[A]; Fiscal year 2005 expected allocation: $26,100,000. Source: Delaware Health and Social Services. [A] Amount includes carry-over funds. [End of table] Georgia: Georgia reported receiving $156,330,702 from MSA payments in fiscal year 2004 and expects to receive $146,123,673 in fiscal year 2005. Table 14: Georgia's MSA Payment Allocations: Program area: Economic development for tobacco regions; Fiscal year 2004 allocation: $65,834,093; Fiscal year 2005 expected allocation: $47,123,333; Examples of programs receiving or expected to receive allocations: OneGeorgia Authority. Program area: Health; Fiscal year 2004 allocation: $88,894,466; Fiscal year 2005 expected allocation: $89,293,004; Examples of programs receiving or expected to receive allocations: Support for Medicaid and State Children's Health Insurance Program, Critical Access Hospital Reimbursement, Medicaid Home and Community Based Waiver Programs, Georgia Cancer Coalition, public health programs. Program area: Social services; Fiscal year 2004 allocation: $7,149,804; Fiscal year 2005 expected allocation: $7,149,804; Examples of programs receiving or expected to receive allocations: Home and community-based services to the elderly, early intervention for families at risk for child abuse. Program area: Tobacco control; Fiscal year 2004 allocation: $12,506,336; Fiscal year 2005 expected allocation: $12,803,859; Examples of programs receiving or expected to receive allocations: Tobacco Use Prevention Program, compliance and enforcement for underage smoking. Total; Fiscal year 2004 allocation: $174,384,699[A]; Fiscal year 2005 expected allocation: $156,370,000[A]. Source: Georgia Office of Planning and Budget. [A] Amounts include carry-over funds. [End of table] Hawaii: Hawaii reported receiving $38,837,269 from MSA payments in fiscal year 2004 and expects to receive $42,574,552 in fiscal year 2005. Table 15: Hawaii's MSA Payment Allocations: Program area: General purposes; Fiscal year 2004 allocation: $2,814,702; Fiscal year 2005 expected allocation: $3,054,035; Examples of programs receiving or expected to receive allocations: Tobacco Enforcement Special Fund of the Attorney General's Office for MSA enforcement, assessments for central services and administrative expenses. Program area: Health; Fiscal year 2004 allocation: $12,607,898; Fiscal year 2005 expected allocation: $13,832,181; Examples of programs receiving or expected to receive allocations: Department of Health for public health programs, Department of Human Services for children's health insurance programs. Program area: Infrastructure; Fiscal year 2004 allocation: $10,086,319; Fiscal year 2005 expected allocation: $11,065,745; Examples of programs receiving or expected to receive allocations: Debt service on University of Hawaii revenue bonds issued for the new Health and Wellness Center, to include a new biomedical research center and medical school. Program area: Reserves/Rainy day funds; Fiscal year 2004 allocation: $8,825,529; Fiscal year 2005 expected allocation: $9,682,527; Examples of programs receiving or expected to receive allocations: State of Hawaii's Emergency and Budget Reserve Fund. Program area: Tobacco control; Fiscal year 2004 allocation: $4,502,821; Fiscal year 2005 expected allocation: $4,940,064; Examples of programs receiving or expected to receive allocations: Tobacco Prevention and Control Trust Fund. Total; Fiscal year 2004 allocation: $38,837,269; Fiscal year 2005 expected allocation: $42,574,552. Source: Hawaii Department of Budget and Finance. [End of table] Idaho: Idaho reported receiving $22,818,949 from MSA payments in fiscal year 2004 and expects to receive $23,830,716 in fiscal year 2005. Table 16: Idaho's MSA Payment Allocations: Program area: Health; Fiscal year 2004 allocation: $835,000; Fiscal year 2005 expected allocation: $500,000; Examples of programs receiving or expected to receive allocations: Catastrophic Health Care Cost Program for tobacco-related disease treatment and for caring for indigent persons. Program area: Social services; Fiscal year 2004 allocation: $270,000; Fiscal year 2005 expected allocation: $270,000; Examples of programs receiving or expected to receive allocations: Youth courts and status offender programs related to tobacco and substance abuse issues. Program area: Tobacco control; Fiscal year 2004 allocation: $1,333,700; Fiscal year 2005 expected allocation: $1,169,700; Examples of programs receiving or expected to receive allocations: Youth smoking cessation and reduction program; incorporation of tobacco control model within Idaho health care recommended by the Centers for Disease Control and Prevention; tobacco counter-marketing program; public health districts tobacco cessation programs; youth tobacco investigations. Program area: Unallocated; Fiscal year 2004 allocation: $20,380,249; Fiscal year 2005 expected allocation: $21,891,016. Total; Fiscal year 2004 allocation: $22,818,949; Fiscal year 2005 expected allocation: $23,830,716. Source: Idaho Division of Financial Management. [End of table] Illinois: Illinois reported receiving $292,256,066 from MSA payments in fiscal year 2004 and expects to receive $270,989,300 in fiscal year 2005. Table 17: Illinois's MSA Payment Allocations: Program area: Education; Fiscal year 2004 allocation: $15,760,000; Fiscal year 2005 expected allocation: $13,800,000; Examples of programs receiving or expected to receive allocations: Payments to Centers for Academic Excellence for medical research. Program area: General purposes; Fiscal year 2004 allocation: $40,064,867; Fiscal year 2005 expected allocation: $25,961,291; Examples of programs receiving or expected to receive allocations: Technology marketing, technology centers, administrative fees charged to the tobacco fund, audit expenses charged to the tobacco fund ($22.5 million is automatically diverted into an escrow account for attorneys' fees). Program area: Health; Fiscal year 2004 allocation: $181,772,387; Fiscal year 2005 expected allocation: $239,867,350; Examples of programs receiving or expected to receive allocations: Medicaid drugs, drugs for Senior Citizens. Program area: Infrastructure; Fiscal year 2004 allocation: $2,963,066; Fiscal year 2005 expected allocation: $5,000,000; Examples of programs receiving or expected to receive allocations: Capital maintenance on state-owned facilities. Program area: Social services; Fiscal year 2004 allocation: $1,030,856; Fiscal year 2005 expected allocation: $1,100,000; Examples of programs receiving or expected to receive allocations: Outreach program to the aging. Program area: Tax reductions; Fiscal year 2004 allocation: $55,661,645; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Property tax reduction for senior citizens. Program area: Tobacco control; Fiscal year 2004 allocation: $7,664,670; Fiscal year 2005 expected allocation: $12,914,500; Examples of programs receiving or expected to receive allocations: Tobacco prevention activities of local health departments, tobacco control programs, tobacco enforcement programs, enforcement of MSA provisions, grant to the American Lung Association. Total; Fiscal year 2004 allocation: $304,917,491[A]; Fiscal year 2005 expected allocation: $298,643,141[A]. Source: Illinois Governor's Office of Management and Budget. [A] Amounts include carry-over funds. [End of table] Indiana: Indiana reported receiving $126,800,000 from MSA payments in fiscal year 2004 and expects to receive $129,300,000 in fiscal year 2005. Table 18: Indiana's MSA Payment Allocations: Program area: Economic development for tobacco regions; Fiscal year 2004 allocation: $46,200,000; Fiscal year 2005 expected allocation: $46,200,000; Examples of programs receiving or expected to receive allocations: Rural Development Administration Fund, Rural Development Council Fund, Value-Added Research Fund, Technology Development Grant Fund, 21st Century Research and Technology Fund. Program area: Health; Fiscal year 2004 allocation: $86,800,000; Fiscal year 2005 expected allocation: $89,200,000; Examples of programs receiving or expected to receive allocations: State Department of Health administration, Cancer Registry, Sickle Cell, Aid to TB Hospitals, AIDS Education, HIV/AIDS Services, Test for Drug-Afflicted Babies, State Chronic Diseases, WIC Supplement, MCH Supplement, Breast Cancer Education and Diagnosis, Minority Health Initiative, Minority Epidemiology, Children's Health Insurance Program, Hoosier Rx, Local Health Maintenance Fund, Local Health Department Account, Community Health Centers. Program area: Infrastructure; Fiscal year 2004 allocation: $1,450,000; Fiscal year 2005 expected allocation: $1,450,000; Examples of programs receiving or expected to receive allocations: Regional health facilities. Program area: Social services; Fiscal year 2004 allocation: $24,300,000; Fiscal year 2005 expected allocation: $24,300,000; Examples of programs receiving or expected to receive allocations: Developmentally Disabled (DD) client services, DD Direct Care salaries. Program area: Tobacco control; Fiscal year 2004 allocation: $10,800,000; Fiscal year 2005 expected allocation: $10,800,000; Examples of programs receiving or expected to receive allocations: Tobacco use and prevention cessation. Total; Fiscal year 2004 allocation: $169,550,000[A]; Fiscal year 2005 expected allocation: $171,950,000[A]. Source: Indiana State Budget Agency. [A] Amounts include carry-over funds and interest earned. [End of table] Iowa: Iowa reported receiving $54,609,359 from MSA payments in fiscal year 2004 and expects to receive $55,137,861 in fiscal year 2005. In addition, Iowa reported receiving $63,512,236 in securitized proceeds in fiscal year 2004 and expects to receive $63,792,236 in fiscal year 2005. Table 19: Iowa's Allocations of MSA Payments and Securitized proceeds: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $42,595,300; Fiscal year 2005 expected allocation: $43,007,532; Examples of programs receiving or expected to receive allocations: [Empty]. Program area: Education; Fiscal year 2004 allocation: $2,153,250; Fiscal year 2005 expected allocation: $2,153,250; Examples of programs receiving or expected to receive allocations: Early childhood programs. Program area: General purposes; Fiscal year 2004 allocation: $2,107,285; Fiscal year 2005 expected allocation: $2,237,285; Examples of programs receiving or expected to receive allocations: Correctional programs. Program area: Health; Fiscal year 2004 allocation: $66,197,195; Fiscal year 2005 expected allocation: $66,445,465; Examples of programs receiving or expected to receive allocations: Endowment for Iowa's Health Account. Program area: Tobacco control; Fiscal year 2004 allocation: $5,068,565; Fiscal year 2005 expected allocation: $5,086,565; Examples of programs receiving or expected to receive allocations: Tobacco use/control and cessation programs. Total; Fiscal year 2004 allocation: $118,121,595; Fiscal year 2005 expected allocation: $118,930,097;. Source: Iowa Department of Management. [End of table] Kansas: Kansas reported receiving $52,349,060 from MSA payments in fiscal year 2004 and expects to receive $52,000,000 in fiscal year 2005. Table 20: Kansas's MSA Payment Allocations: Program area: Education; Fiscal year 2004 allocation: $8,525,000; Fiscal year 2005 expected allocation: $8,525,000; Examples of programs receiving or expected to receive allocations: Parent education, 4-year-olds at risk, vision research, special education. Program area: General purposes; Fiscal year 2004 allocation: $11,044,144; Fiscal year 2005 expected allocation: $5,111,533; Examples of programs receiving or expected to receive allocations: To State General Fund. Program area: Health; Fiscal year 2004 allocation: $1,800,000; Fiscal year 2005 expected allocation: $1,800,000; Examples of programs receiving or expected to receive allocations: Infants and toddlers, healthy start home visitors, smoking prevention and cessation, telekid health care link. Program area: Social services; Fiscal year 2004 allocation: $32,407,931; Fiscal year 2005 expected allocation: $41,865,293; Examples of programs receiving or expected to receive allocations: Juvenile justice prevention and sanction grants, children's mental health initiative, family-centered systems of care, therapeutic preschool, childcare and child welfare community services, healthwave, Medicaid, smart start Kansas, immunization outreach, school violence prevention, family preservation, community mental health center grants. Total; Fiscal year 2004 allocation: $53,777,075[A]; Fiscal year 2005 expected allocation: $57,301,826[A]. Source: Kansas Division of the Budget. [A] Amounts include carry-over funds and interest earned. [End of table] Kentucky: Kentucky reported receiving $109,482,959 from MSA payments in fiscal year 2004 and expects to receive $108,800,000 in fiscal year 2005. Table 21: Kentucky's MSA Payment Allocations: Program area: Economic development for tobacco regions; Fiscal year 2004 allocation: $43,434,000; Fiscal year 2005 expected allocation: $48,283,400; Examples of programs receiving or expected to receive allocations: Governor's Office for Agricultural Policy, Conservation, Environmental Stewardship. Program area: Education; Fiscal year 2004 allocation: $5,961,700; Fiscal year 2005 expected allocation: $10,952,500; Examples of programs receiving or expected to receive allocations: Families and Children--Childhood Development Program, Governor's Office of Early Childhood--Development Program, Kentucky's Higher Education Assistance Authority--Early Childhood Scholarship Program. Program area: General purposes; Fiscal year 2004 allocation: $382,959; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Directed to the General Fund. Program area: Health; Fiscal year 2004 allocation: $43,624,200; Fiscal year 2005 expected allocation: $38,500,700; Examples of programs receiving or expected to receive allocations: Public Health-- Health Access Nurturing Development Services, Folic Acid Distribution, Healthy Start, Universal Children's Immunization; Child advocacy centers; Early Childhood Mental and Oral Health; Mental Health- Substance Abuse Services to Medicaid Eligible Women with Dependent Children; Children with Special Health Care Needs-Universal Newborn Hearing Testing and Vision Screening, Council on Postsecondary Education--Lung Cancer Research Program; Insurance--Kentucky Access (High Risk Individual Insurance Pool);Testing and Vision Screening-- First Steps Early Intervention Program. Program area: Infrastructure; Fiscal year 2004 allocation: $11,116,000; Fiscal year 2005 expected allocation: $6,116,600; Examples of programs receiving or expected to receive allocations: Debt service-- Kentucky Infrastructure Authority--Water Resource Development. Program area: Tobacco control; Fiscal year 2004 allocation: $4,964,100; Fiscal year 2005 expected allocation: $4,946,800; Examples of programs receiving or expected to receive allocations: Public Health-- Smoking cessation; Governor's Office--Kentucky Agency for Substance Abuse Policy--Smoking Cessation. Total; Fiscal year 2004 allocation: $109,482,959; Fiscal year 2005 expected allocation: $108,800,000. Source: Kentucky Governor's Office for Policy Research. [End of table] Louisiana: Louisiana reported receiving $141,621,328 from MSA payments in fiscal year 2004 and expects to receive $145,362,442 in fiscal year 2005. Table 22: Louisiana's MSA Payment Allocations: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $84,972,800; Fiscal year 2005 expected allocation: $87,217,465. Program area: General purposes; Fiscal year 2004 allocation: $341,260; Fiscal year 2005 expected allocation: $350,000; Examples of programs receiving or expected to receive allocations: Attorney General's Office for enforcement. Program area: Health; Fiscal year 2004 allocation: $11,831,735; Fiscal year 2005 expected allocation: $13,686,244; Examples of programs receiving or expected to receive allocations: School-based health care centers (OPH), Medicaid, Board of Regents and health care science grants. Program area: Social services; Fiscal year 2004 allocation: $1,489,137; Fiscal year 2005 expected allocation:; Examples of programs receiving or expected to receive allocations: Starting points preschool programs. Program area: Tobacco control; Fiscal year 2004 allocation: $500,000; Fiscal year 2005 expected allocation: $500,000; Examples of programs receiving or expected to receive allocations: Smoking prevention and cessation grants. Program area: Unallocated; Fiscal year 2004 allocation: $42,486,396; Fiscal year 2005 expected allocation: $43,608,733. Total; Fiscal year 2004 allocation: $141,621,328; Fiscal year 2005 expected allocation: $145,362,442. Source: Louisiana Division of Administration, Office of Planning and Budget. [End of table] Maine: Maine reported receiving $48,952,964 from MSA payments in fiscal year 2004 and expects to receive $48,772,127 in fiscal year 2005. Table 23: Maine's MSA Payment Allocations: Program area: Budget shortfalls; Fiscal year 2004 allocation: $6,656,040; Fiscal year 2005 expected allocation: $0. Program area: Education; Fiscal year 2004 allocation: $10,166,959; Fiscal year 2005 expected allocation: $11,069,704; Examples of programs receiving or expected to receive allocations: Child care and development initiatives, after-school services and Head Start. Program area: General purposes; Fiscal year 2004 allocation: $60,089; Fiscal year 2005 expected allocation: $58,281; Examples of programs receiving or expected to receive allocations: Attorney General enforcement and administrative costs. Program area: Health; Fiscal year 2004 allocation: $19,425,389; Fiscal year 2005 expected allocation: $19,214,049; Examples of programs receiving or expected to receive allocations: Prescription drugs, Medicaid and other health initiatives. Program area: Social services; Fiscal year 2004 allocation: $5,808,184; Fiscal year 2005 expected allocation: $5,765,892; Examples of programs receiving or expected to receive allocations: Substance abuse prevention, intervention, testing and treatment. Program area: Tobacco control; Fiscal year 2004 allocation: $14,579,102; Fiscal year 2005 expected allocation: $15,120,903; Examples of programs receiving or expected to receive allocations: Community/school grants and statewide coordination to reduce tobacco addiction and use; tobacco prevention, control, and treatment. Total; Fiscal year 2004 allocation: $56,695,763[A]; Fiscal year 2005 expected allocation: $51,228,829[A]. Source: Maine Department of Administrative and Financial Services, Bureau of the Budget. [A] Amounts include carry-over funds and/or interest earned. [End of table] Maryland: Maryland reported receiving $149,942,000 from MSA payments in fiscal year 2004 and expects to receive $142,607,000 in fiscal year 2005. Table 24: Maryland's MSA Payment Allocations: Program area: Education; Fiscal year 2004 allocation: $3,000,000; Fiscal year 2005 expected allocation: $3,000,000; Examples of programs receiving or expected to receive allocations: Textbooks for nonpublic schools. Program area: General purposes; Fiscal year 2004 allocation: $30,000,000; Fiscal year 2005 expected allocation: $30,170,000; Examples of programs receiving or expected to receive allocations: Legal fees and settlement with outside counsel. Program area: Health; Fiscal year 2004 allocation: $152,889,000; Fiscal year 2005 expected allocation: $98,268,000; Examples of programs receiving or expected to receive allocations: Cancer, heart, and lung screenings and treatments; Maryland Health Care Foundation; Medicaid; management. Program area: Payments to tobacco growers; Fiscal year 2004 allocation: $5,100,000; Fiscal year 2005 expected allocation: $5,653,000; Examples of programs receiving or expected to receive allocations: Tri- County Council of Southern Maryland (buyout payments to farmers). Program area: Tobacco control; Fiscal year 2004 allocation: $13,798,000; Fiscal year 2005 expected allocation: $9,484,000; Examples of programs receiving or expected to receive allocations: Tobacco use prevention and cessation programs. Program area: Unallocated; Fiscal year 2004 allocation: $10,360,000; Fiscal year 2005 expected allocation: $6,391,000. Total; Fiscal year 2004 allocation: $215,147,000[A]; Fiscal year 2005 expected allocation: $152,966,000[A]. Source: Maryland Department of Budget and Management. [A] Amounts include carry-over funds and interest earned. [End of table] Massachusetts: Massachusetts reported receiving $253,621,276 from MSA payments in fiscal year 2004 and expects to receive $253,600,000 in fiscal year 2005. Table 25: Massachusetts's MSA Payment Allocation: Program area: General purposes; Fiscal year 2004 allocation: $253,943,730; Fiscal year 2005 expected allocation: $253,600,000; Examples of programs receiving or expected to receive allocations: All MSA revenues deposited in the Commonwealth's General Fund in fiscal years 2004 and 2005. Total; Fiscal year 2004 allocation: $253,943,730[A]; Fiscal year 2005 expected allocation: $253,600,000. Source: Massachusetts Executive Office of Administration and Finance, Fiscal Affairs Division. [A] Amount includes interest earned. [End of table] Michigan: Michigan reported receiving $270,540,221 from MSA payments in fiscal year 2004 and expects to receive $285,700,000 in fiscal year 2005. Table 26: Michigan's MSA Payment Allocations: Program area: Budget shortfalls; Fiscal year 2004 allocation: $64,000,000; Fiscal year 2005 expected allocation: $7,000,000. Program area: Education; Fiscal year 2004 allocation: $104,900,000; Fiscal year 2005 expected allocation: $102,200,000; Examples of programs receiving or expected to receive allocations: Scholarships and tuition incentive grants for higher education students, testing for K- 12 students, Michigan Education Savings Plan, nursing scholarships, general higher education support. Program area: General purposes; Fiscal year 2004 allocation: $400,000; Fiscal year 2005 expected allocation: $400,000; Examples of programs receiving or expected to receive allocations: Attorney General administrative expenses. Program area: Health; Fiscal year 2004 allocation: $107,700,000; Fiscal year 2005 expected allocation: $186,800,000; Examples of programs receiving or expected to receive allocations: Elder pharmaceutical assistance, Medicaid personal needs allowance, respite care, Medicaid support, biomedical research and development. Program area: Unallocated; Fiscal year 2004 allocation: $9,200,000; Fiscal year 2005 expected allocation: $500,000. Total; Fiscal year 2004 allocation: $286,200,000[A]; Fiscal year 2005 expected allocation: $296,900,000[A]. Source: Michigan Office of Health and Human Services, State Budget Office. [A] Amounts include carry-over funds and interest earned. [End of table] Missouri: Missouri reported receiving $142,829,966 from MSA payments in fiscal year 2004 and expects to receive $144,000,000 in fiscal year 2005. Table 27: Missouri's MSA Payment Allocations: Program area: Budget shortfalls; Fiscal year 2004 allocation: $70,715,848; Fiscal year 2005 expected allocation: $70,772,048. Program area: General purposes; Fiscal year 2004 allocation: $4,426,858; Fiscal year 2005 expected allocation: $2,427,411; Examples of programs receiving or expected to receive allocations: Transferred to state general revenue fund to support any state program funded from general revenue, such as education, Medicaid and corrections. Program area: Health; Fiscal year 2004 allocation: $69,726,564; Fiscal year 2005 expected allocation: $70,369,652; Examples of programs receiving or expected to receive allocations: Payments to Medicaid providers and grants to hospitals for graduate medical education, prescription drug assistance for low-income seniors through the Missouri Senior Rx Program. Program area: Tobacco control; Fiscal year 2004 allocation: $472,829; Fiscal year 2005 expected allocation: $482,414; Examples of programs receiving or expected to receive allocations: Enforcement of the state's laws on underage tobacco use. Total; Fiscal year 2004 allocation: $145,342,099[A]; Fiscal year 2005 expected allocation: $144,051,525[A]. Source: Missouri Division of Budget and Planning. [A] Amounts include carry-over funds. [End of table] Montana: Montana reported receiving $26,672,073 from MSA payments in fiscal year 2004 and expects to receive $26,223,000 in fiscal year 2005. Table 28: Montana's MSA Payment Allocations: Program area: General purposes; Fiscal year 2004 allocation: $2,933,928; Fiscal year 2005 expected allocation: $2,884,530; Examples of programs receiving or expected to receive allocations: General fund transfer. Program area: Health; Fiscal year 2004 allocation: $18,250,852; Fiscal year 2005 expected allocation: $18,601,209; Examples of programs receiving or expected to receive allocations: State Children's Health Insurance Program, Medicaid, Mental health services, hospice and home health and Tobacco Trust Fund. Program area: Social services; Fiscal year 2004 allocation: $2,149,579; Fiscal year 2005 expected allocation: $2,589,726; Examples of programs receiving or expected to receive allocations: Childcare, child support enforcement, infant mortality abatement, poison control, AIDS prevention, independent living and extended employment. Program area: Tobacco control; Fiscal year 2004 allocation: $2,514,645; Fiscal year 2005 expected allocation: $2,970,604; Examples of programs receiving or expected to receive allocations: Tobacco prevention. Program area: Unallocated; Fiscal year 2004 allocation: $823,069; Fiscal year 2005 expected allocation: $0. Total; Fiscal year 2004 allocation: $26,672,073; Fiscal year 2005 expected allocation: $27,046,069[A]. Source: Montana Office of Budget and Planning. [A] Amount includes carry-over funds. [End of table] Nebraska: Nebraska reported receiving $37,858,162 from MSA payments in fiscal year 2004 and expects to receive $35,600,000 in fiscal year 2005. Table 29: Nebraska's MSA Payment Allocations: Program area: General purposes; Fiscal year 2004 allocation: $88,437; Fiscal year 2005 expected allocation: $86,595; Examples of programs receiving or expected to receive allocations: MSA model statute enforcement. Program area: Health; Fiscal year 2004 allocation: $21,006,570; Fiscal year 2005 expected allocation: $20,333,933; Examples of programs receiving or expected to receive allocations: Behavioral health, public health, minority health, State Children's Health Insurance Program, biomedical research. Program area: Social services; Fiscal year 2004 allocation: $2,788,800; Fiscal year 2005 expected allocation: $2,730,700; Examples of programs receiving or expected to receive allocations: Community-based developmental disability services, respite care assistance. Program area: Unallocated; Fiscal year 2004 allocation: $13,974,355; Fiscal year 2005 expected allocation: $12,448,772. Total; Fiscal year 2004 allocation: $37,858,162; Fiscal year 2005 expected allocation: $35,600,000. Source: Nebraska Department of Administrative Services, Budget Division. [End of table] Nevada: Nevada reported receiving $38,299,907 from MSA payments in fiscal year 2004 and expects to receive $38,666,164 in fiscal year 2005. Table 30: Nevada's MSA Payment Allocations: Program area: Education; Fiscal year 2004 allocation: $29,254,375; Fiscal year 2005 expected allocation: $32,966,914; Examples of programs receiving or expected to receive allocations: Scholarship program for Nevada students who attend a Nevada higher education institution. Program area: General purposes; Fiscal year 2004 allocation: $257,412; Fiscal year 2005 expected allocation: $260,971; Examples of programs receiving or expected to receive allocations: Attorney General's tobacco retail enforcement and master settlement legal expenses. Program area: Health; Fiscal year 2004 allocation: $14,166,437; Fiscal year 2005 expected allocation: $12,986,804; Examples of programs receiving or expected to receive allocations: Grants to improve health services for children and persons with disabilities, prescription drugs and pharmaceutical services for low- income seniors, and an endowment fund that expends interest earnings to provide grants for the promotion of public health. Program area: Social services; Fiscal year 2004 allocation: $8,948,725; Fiscal year 2005 expected allocation: $7,437,291; Examples of programs receiving or expected to receive allocations: Grants to assist senior citizens to live independently, support senior services, and a homemaker program. Program area: Tobacco control; Fiscal year 2004 allocation: $5,013,173; Fiscal year 2005 expected allocation: $4,679,439; Examples of programs receiving or expected to receive allocations: Grants for tobacco cessation programs. Total; Fiscal year 2004 allocation: $57,640,122[A]; Fiscal year 2005 expected allocation: $58,331,419[A]. Source: Nevada Budget Office. [A] Amounts include carry-over funds. [End of table] New Hampshire: New Hampshire reported receiving $41,800,000 from MSA payments in fiscal year 2004 and expects to receive $39,600,000 in fiscal year 2005. Table 31: New Hampshire's MSA Payment Allocations: Program area: Education; Fiscal year 2004 allocation: $40,000,000; Fiscal year 2005 expected allocation: $39,600,000; Examples of programs receiving or expected to receive allocations: K-12 adequate grants to schools. Program area: General purposes; Fiscal year 2004 allocation: $1,800,000; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: No specific programs. Total; Fiscal year 2004 allocation: $41,800,000; Fiscal year 2005 expected allocation: $39,600,000. Source: New Hampshire Office of Legislative Budget Assistant. [End of table] New Jersey: New Jersey reported receiving $242,800,000 from MSA payments in fiscal year 2004 and expects to receive $245,100,000 in fiscal year 2005. Table 32: New Jersey's Allocations of MSA Payments and Securitized proceeds: Program area: Budget shortfalls; Fiscal year 2004 allocation: $873,300,000; Fiscal year 2005 expected allocation: $0. Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $120,200,000; Fiscal year 2005 expected allocation: $245,100,000. Program area: Health; Fiscal year 2004 allocation: $122,600,000; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Family Care, new and expanded community options for seniors, expansion of cancer initiative, Senior Gold Pharmaceutical Assistance. Program area: Infrastructure; Fiscal year 2004 allocation: $608,000,000; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Institutional, transportation and other projects. Total; Fiscal year 2004 allocation: $1,724,100,000[A]; Fiscal year 2005 expected allocation: $245,100,000. Source: New Jersey Office of Management and Budget. [A] Amount includes some securitized proceeds received in fiscal year 2003. [End of table] New Mexico: New Mexico reported receiving $37,449,345 from MSA payments in fiscal year 2004 and expects to receive $34,779,246 in fiscal year 2005. Table 33: New Mexico's MSA Payment Allocations: Program area: Education; Fiscal year 2004 allocation: $800,000; Fiscal year 2005 expected allocation: $800,000; Examples of programs receiving or expected to receive allocations: Education in trauma, critical, and emergency care and pediatrics. Program area: General purposes; Fiscal year 2004 allocation: $0; Fiscal year 2005 expected allocation: $12,644,246; Examples of programs receiving or expected to receive allocations: Balances after appropriations to education and health are deposited into the General Fund. Program area: Health; Fiscal year 2004 allocation: $36,649,345; Fiscal year 2005 expected allocation: $21,335,000; Examples of programs receiving or expected to receive allocations: Tobacco cessation and prevention, diabetes and HIV services and medication, breast and cervical cancer treatment, preventing and treating tobacco- related illnesses, poison control, telemedicine, expanded lung and illness research, Medicaid. Total; Fiscal year 2004 allocation: $37,449,345; Fiscal year 2005 expected allocation: $34,779,246. Source: New Mexico Department of Finance and Administration. [End of table] New York: New York reported receiving $349,494,266 from MSA payments in fiscal year 2004 and expects to receive $406,007,613 in fiscal year 2005. In addition, New York reported receiving $4,200,000,000 in securitized proceeds in fiscal year 2004 and expects to receive no securitized proceeds in fiscal year 2005. Table 34: New York's Allocation of MSA Payments and Securitized proceeds: Program area: Budget shortfalls; Fiscal year 2004 allocation: $3,800,000,000; Fiscal year 2005 expected allocation: $582,034,000. Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $0; Fiscal year 2005 expected allocation: $223,973,217. Program area: Health; Fiscal year 2004 allocation: $322,016,427; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Medicaid, indigent care, elderly pharmaceutical program, Family Health Plus, health insurance for the uninsured, breast and cervical cancer treatment and similar programs. Program area: Tobacco control; Fiscal year 2004 allocation: $30,000,000; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Tobacco control and prevention activities. Program area: Unallocated; Fiscal year 2004 allocation: $400,000,000; Fiscal year 2005 expected allocation: $0. Total; Fiscal year 2004 allocation: $4,552,016,427; Fiscal year 2005 expected allocation: $806,007,217[A]. Source: New York State Division of the Budget. [A] Amount includes some securitized proceeds received in fiscal year 2004. Note: These MSA payments include only the payments made to the state, which amount to about 51 percent of the annual payments made by the tobacco companies to New York. New York City and counties in the state receive the other 49 percent of the annual MSA payments to New York. [End of table] North Carolina: North Carolina reported receiving $150,507,204 from MSA payments in fiscal year 2004 and expects to receive $163,353,241 in fiscal year 2005. Table 35: North Carolina's MSA Payment Allocations: Program area: Economic development for tobacco regions; Fiscal year 2004 allocation: $75,733,669; Fiscal year 2005 expected allocation: $86,569,690; Examples of programs receiving or expected to receive allocations: Tobacco Trust Fund (Golden Leaf). Program area: General purposes; Fiscal year 2004 allocation: $63,046,734; Fiscal year 2005 expected allocation: $60,000,000. Program area: Health; Fiscal year 2004 allocation: $1,926,801; Fiscal year 2005 expected allocation: $4,193,069; Examples of programs receiving or expected to receive allocations: Health and Wellness Trust Fund (medication assistance and childhood obesity prevention). Program area: Infrastructure; Fiscal year 2004 allocation: $0; Fiscal year 2005 expected allocation: $1,890,482. Program area: Tobacco control; Fiscal year 2004 allocation: $10,700,000; Fiscal year 2005 expected allocation: $10,700,000; Examples of programs receiving or expected to receive allocations: Statewide and community-based teen tobacco use prevention and cessation. Total; Fiscal year 2004 allocation: $151,407,204[A]; Fiscal year 2005 expected allocation: $163,353,241. Source: North Carolina Office of State Budget and Management. [A] Amount includes carry-over funds. [End of table] North Dakota: North Dakota reported receiving $23,289,073 from MSA payments in fiscal year 2004 and expects to receive $22,972,067 in fiscal year 2005. Table 36: North Dakota's MSA Payment Allocations: Program area: Education; Fiscal year 2004 allocation: $10,480,083; Fiscal year 2005 expected allocation: $10,337,430; Examples of programs receiving or expected to receive allocations: Forty-five percent of the MSA funds are deposited in the common schools trust fund and interest earned on the fund is used for K-12 education. Program area: Health; Fiscal year 2004 allocation: $482,000; Fiscal year 2005 expected allocation: $482,000; Examples of programs receiving or expected to receive allocations: Dental loan repayment program, breast and cervical cancer screening. Program area: Infrastructure; Fiscal year 2004 allocation: $10,480,083; Fiscal year 2005 expected allocation: $10,337,430; Examples of programs receiving or expected to receive allocations: Water projects. Program area: Tobacco control; Fiscal year 2004 allocation: $1,846,907; Fiscal year 2005 expected allocation: $1,815,207; Examples of programs receiving or expected to receive allocations: Tobacco cessation programs. Total; Fiscal year 2004 allocation: $23,289,073; Fiscal year 2005 expected allocation: $22,972,067. Source: North Dakota Office of Management and Budget, Fiscal Management Division. [End of table] Ohio: Ohio reported receiving $320,531,457 from MSA payments in fiscal year 2004 and expects to receive $290,886,750 in fiscal year 2005. Table 37: Ohio's MSA Payment Allocations: Program area: Budget shortfalls; Fiscal year 2004 allocation: $234,678,219; Fiscal year 2005 expected allocation: $0. Program area: Economic development for tobacco regions; Fiscal year 2004 allocation: $15,144,938; Fiscal year 2005 expected allocation: $12,600,000; Examples of programs receiving or expected to receive allocations: Grants to make capital improvements in marketable industrial sites. Program area: Education; Fiscal year 2004 allocation: $7,553,152; Fiscal year 2005 expected allocation: $6,274,109; Examples of programs receiving or expected to receive allocations: Technology enhancements in schools. Program area: General purposes; Fiscal year 2004 allocation: $786,109; Fiscal year 2005 expected allocation: $801,831; Examples of programs receiving or expected to receive allocations: Administration, oversight, enforcement activities related to the MSA. Program area: Health; Fiscal year 2004 allocation: $37,237,451; Fiscal year 2005 expected allocation: $34,681,892; Examples of programs receiving or expected to receive allocations: Minority health programs, alcohol and drug abuse prevention and biomedical tech transfer. Program area: Infrastructure; Fiscal year 2004 allocation: $5,000,000; Fiscal year 2005 expected allocation: $126,389,326; Examples of programs receiving or expected to receive allocations: School construction. Program area: Social services; Fiscal year 2004 allocation: $3,852,400; Fiscal year 2005 expected allocation: $3,855,051; Examples of programs receiving or expected to receive allocations: Funding for uncompensated health care of uninsured. Program area: Tobacco control; Fiscal year 2004 allocation: $17,487,294; Fiscal year 2005 expected allocation: $108,136,000; Examples of programs receiving or expected to receive allocations: Under-age tobacco use enforcement and tobacco use prevention and cessation programs. Total; Fiscal year 2004 allocation: $321,739,563[A]; Fiscal year 2005 expected allocation: $292,738,209[A]. Source: Ohio Office of Budget and Management. [A] Amounts include carry-over funds and interest earned. [End of table] Oklahoma: Oklahoma reported receiving $65,062,578 from MSA payments in fiscal year 2004 and expects to receive $49,783,729 in fiscal year 2005. Table 38: Oklahoma's MSA Payment Allocations: Program area: General purposes; Fiscal year 2004 allocation: $1,411,918; Fiscal year 2005 expected allocation: $1,016,000; Examples of programs receiving or expected to receive allocations: Attorney General's Evidence Fund. Program area: Health; Fiscal year 2004 allocation: $30,964,800; Fiscal year 2005 expected allocation: $34,613,717; Examples of programs receiving or expected to receive allocations: Medicaid and deposit to Tobacco Settlement Endowment Trust Fund on behalf of health programs. Program area: Social services; Fiscal year 2004 allocation: $15,610,837; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Child welfare, foster care, services for homebound elders and senior nutrition. Program area: Tobacco control; Fiscal year 2004 allocation: $17,075,023; Fiscal year 2005 expected allocation: $14,154,012; Examples of programs receiving or expected to receive allocations: Deposit to the Tobacco Settlement Endowment Trust Fund on behalf of tobacco control programs. Total; Fiscal year 2004 allocation: $65,062,578; Fiscal year 2005 expected allocation: $49,783,729. Source: Oklahoma Office of State Finance. [End of table] Oregon: Oregon reported receiving $72,065,376 from MSA payments in fiscal year 2004 and expects to receive $73,555,259 in fiscal year 2005. In addition, Oregon reported receiving $109,565,000 in securitized proceeds in fiscal year 2004 and expects to receive no securitized proceeds in fiscal year 2005. Table 39: Oregon's Allocations of MSA Payments and Securitized proceeds: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $7,603,713; Fiscal year 2005 expected allocation: $43,860,304. Program area: Health; Fiscal year 2004 allocation: $14,608,216; Fiscal year 2005 expected allocation: $27,600,000; Examples of programs receiving or expected to receive allocations: Oregon health plan/family health insurance assistance program. Program area: Infrastructure; Fiscal year 2004 allocation: $109,565,000; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Capital projects at Oregon Health and Sciences University--a state teaching hospital. Program area: Tobacco control; Fiscal year 2004 allocation: $0; Fiscal year 2005 expected allocation: $700,000; Examples of programs receiving or expected to receive allocations: Tobacco enforcement and prevention services. Program area: Unallocated; Fiscal year 2004 allocation: $49,853,447; Fiscal year 2005 expected allocation: $51,248,402. Total; Fiscal year 2004 allocation: $181,630,376; Fiscal year 2005 expected allocation: $123,408,706[A]. Source: Oregon Department of Administrative Services. [A] Amount includes carry-over funds. [End of table] Pennsylvania: Pennsylvania reported receiving $370,856,755 from MSA payments in fiscal year 2004 and expects to receive $357,566,328 in fiscal year 2005. Table 40: Pennsylvania's MSA Payment Allocation: Program area: Health; Fiscal year 2004 allocation: $416,818,000; Fiscal year 2005 expected allocation: $370,857,000; Examples of programs receiving or expected to receive allocations: Smoking prevention and cessation; home and community-based care; venture capital for medical equipment, support for the uninsured; and catastrophic and uncompensated care. Total; Fiscal year 2004 allocation: $416,818,000[A]; Fiscal year 2005 expected allocation: $370,857,000[A]. Source: Pennsylvania Governor's Office of the Budget. [A] Amounts include carry-over funds and interest earned. [End of table] Rhode Island: Rhode Island reported receiving $45,142,523 from MSA payments in fiscal year 2004 and expects to receive $47,381,000 in fiscal year 2005. In addition, Rhode Island reported receiving $1,621,487 in securitized proceeds in fiscal year 2004 and expects to receive no securitized proceeds in fiscal year 2005. Table 41: Rhode Island's Allocations of MSA Payments and Securitized proceeds: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $44,688,862; Fiscal year 2005 expected allocation: $47,381,000. Program area: General purposes; Fiscal year 2004 allocation: $2,075,148; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Any program that receives general fund support. Total; Fiscal year 2004 allocation: $46,764,010; Fiscal year 2005 expected allocation: $47,381,000. Source: State of Rhode Island Budget Office. [End of table] South Carolina: South Carolina reported receiving $73,124,607 from MSA payments in fiscal year 2004 and expects to receive $75,582,954 in fiscal year 2005. Table 42: South Carolina's MSA Payment Allocation: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $73,124,607; Fiscal year 2005 expected allocation: $75,582,954. Total; Fiscal year 2004 allocation: $73,124,607; Fiscal year 2005 expected allocation: $75,582,954. Source: South Carolina Office of State Budget. [End of table] South Dakota: South Dakota reported receiving $21,911,498 from MSA payments in fiscal year 2004 and expects to receive $23,063,730 in fiscal year 2005. Table 43: South Dakota's MSA Payment Allocations: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $21,911,948; Fiscal year 2005 expected allocation: $23,063,730. Program area: Education; Fiscal year 2004 allocation: $14,161,048; Fiscal year 2005 expected allocation: $13,572,737; Examples of programs receiving or expected to receive allocations: State aid to general education, special education, supplemental K-12 allocation, technology in schools, SD Opportunity scholarship, post- secondary vocational education. Program area: Tobacco control; Fiscal year 2004 allocation: $0; Fiscal year 2005 expected allocation: $750,000. Total; Fiscal year 2004 allocation: $36,072,996[A]; Fiscal year 2005 expected allocation: $37,386,467[A]. Source: South Dakota Bureau of Finance and Management. [A] Amounts include interest earned. [End of table] Tennessee: Tennessee reported receiving $153,272,096 from MSA payments in fiscal year 2004 and expects to receive $147,800,000 in fiscal year 2005. Table 44: Tennessee's MSA Payment Allocation: Program area: General purposes; Fiscal year 2004 allocation: $153,272,096; Fiscal year 2005 expected allocation: $147,800,000; Examples of programs receiving or expected to receive allocations: Allocated to the General Fund; not earmarked. Total; Fiscal year 2004 allocation: $153,272,096; Fiscal year 2005 expected allocation: $147,800,000. Source: Tennessee Department of Finance and Administration. [End of table] Utah: Utah reported receiving $27,936,000 from MSA payments in fiscal year 2004 and expects to receive $26,951,100 in fiscal year 2005. Table 45: Utah's MSA Payment Allocations: Program area: Budget shortfalls; Fiscal year 2004 allocation: $9,821,500; Fiscal year 2005 expected allocation: $0. Program area: General purposes; Fiscal year 2004 allocation: $100,000; Fiscal year 2005 expected allocation: $100,000; Examples of programs receiving or expected to receive allocations: Attorney General's office. Program area: Health; Fiscal year 2004 allocation: $13,002,800; Fiscal year 2005 expected allocation: $13,002,800; Examples of programs receiving or expected to receive allocations: State Children's Health Insurance Program, cancer research, immunizations, health promotion. Program area: Reserves/Rainy day funds; Fiscal year 2004 allocation: $5,587,200; Fiscal year 2005 expected allocation: $8,085,300; Examples of programs receiving or expected to receive allocations: Tobacco Permanent Trust Fund--an endowment that allows the Legislature to allocate the interest to fund programs. Program area: Social services; Fiscal year 2004 allocation: $2,000,000; Fiscal year 2005 expected allocation: $2,000,000; Examples of programs receiving or expected to receive allocations: Drug courts, drug board pilot program. Program area: Tobacco control; Fiscal year 2004 allocation: $4,057,900; Fiscal year 2005 expected allocation: $4,076,000; Examples of programs receiving or expected to receive allocations: Tobacco Quit line, TV campaign and prevention partnerships. Total; Fiscal year 2004 allocation: $34,569,400[A]; Fiscal year 2005 expected allocation: $27,264,100[A]. Source: Utah Governor's Office of Planning and Budget. [A] Amounts include carry-over funds. [End of table] Vermont: Vermont reported receiving $25,819,716 from MSA payments in fiscal year 2004 and expects to receive $24,700,000 in fiscal year 2005. Table 46: Vermont's MSA Payment Allocations: Program area: General purposes; Fiscal year 2004 allocation: $388,000; Fiscal year 2005 expected allocation: $388,000; Examples of programs receiving or expected to receive allocations: Attorney General, Tax Department, Drug Court. Program area: Health; Fiscal year 2004 allocation: $17,250,000; Fiscal year 2005 expected allocation: $17,250,000; Examples of programs receiving or expected to receive allocations: Medicaid state match. Program area: Social services; Fiscal year 2004 allocation: $2,885,266; Fiscal year 2005 expected allocation: $4,522,111; Examples of programs receiving or expected to receive allocations: Alcohol and drug programs; safe housing (domestic violence). Program area: Tobacco control; Fiscal year 2004 allocation: $4,120,177; Fiscal year 2005 expected allocation: $4,756,157; Examples of programs receiving or expected to receive allocations: School and public education programs. Total; Fiscal year 2004 allocation: $24,643,443[A]; Fiscal year 2005 expected allocation: $26,916,268[A]. Source: Vermont Department of Finance and Management. [A] Amounts include carry-over funds. [End of table] Virginia: Virginia reported receiving $128,396,522 from MSA payments in fiscal year 2004 and expects to receive $123,256,595 in fiscal year 2005. Table 47: Virginia's MSA Payment Allocations: Program area: Economic development for tobacco regions; Fiscal year 2004 allocation: $44,776,339; Fiscal year 2005 expected allocation: $43,094,800; Examples of programs receiving or expected to receive allocations: Economic development projects, infrastructure, education, job training, research and administration of the Tobacco Indemnification and Community Revitalization Commission. Program area: General purposes; Fiscal year 2004 allocation: $51,358,608; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Deposited to the state general fund and appropriated through the budget process. Program area: Health; Fiscal year 2004 allocation: $0; Fiscal year 2005 expected allocation: $47,542,895; Examples of programs receiving or expected to receive allocations: Deposited to the Virginia Health Care Fund and used to support the Medicaid Program. Program area: Payments to tobacco growers; Fiscal year 2004 allocation: $19,421,923; Fiscal year 2005 expected allocation: $20,000,000; Examples of programs receiving or expected to receive allocations: Indemnification payments to tobacco growers. Program area: Tobacco control; Fiscal year 2004 allocation: $12,839,652; Fiscal year 2005 expected allocation: $12,618,900; Examples of programs receiving or expected to receive allocations: Public education campaigns to discourage tobacco consumption by minors, research and the administrative budget of the Virginia Tobacco Settlement Foundation. Total; Fiscal year 2004 allocation: $128,396,522; Fiscal year 2005 expected allocation: $123,256,595. Source: Virginia Department of Planning and Budget. [End of table] Washington: Washington reported receiving $127,635,700 from MSA payments in fiscal year 2004 and expects to receive $128,000,000 in fiscal year 2005. Table 48: Washington's MSA Payment Allocations: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $37,269,600; Fiscal year 2005 expected allocation: $37,376,000. Program area: Health; Fiscal year 2004 allocation: $90,366,100; Fiscal year 2005 expected allocation: $90,624,000; Examples of programs receiving or expected to receive allocations: Children's Medicaid; subsidized health insurance for low-income state residents; grants to community clinics; grants to local public health jurisdictions; statewide public health programs such as childhood immunizations. Program area: Tobacco control; Fiscal year 2004 allocation: $17,500,000; Fiscal year 2005 expected allocation: $0; Examples of programs receiving or expected to receive allocations: Tobacco prevention and cessation programs. Total; Fiscal year 2004 allocation: $145,135,700[A]; Fiscal year 2005 expected allocation: $128,000,000. Source: Washington State Office of Financial Management. [A] Amount includes carry-over funds. [End of table] West Virginia: West Virginia reported receiving $55,663,874 from MSA payments in fiscal year 2004 and expects to receive $50,800,000 in fiscal year 2005. Table 49: West Virginia's MSA Payment Allocations: Program area: Health; Fiscal year 2004 allocation: $21,990,532; Fiscal year 2005 expected allocation: $19,549,408; Examples of programs receiving or expected to receive allocations: Institutional facilities operations. Program area: Tobacco control; Fiscal year 2004 allocation: $5,850,592; Fiscal year 2005 expected allocation: $5,850,592; Examples of programs receiving or expected to receive allocations: Tobacco education program, ABCA Tobacco Retailer Education Program. Program area: Unallocated; Fiscal year 2004 allocation: $27,822,750; Fiscal year 2005 expected allocation: $25,400,000. Total; Fiscal year 2004 allocation: $55,663,874; Fiscal year 2005 expected allocation: $50,800,000. Source: West Virginia Department of Revenue, State Budget Office. [End of table] Wisconsin: Wisconsin reported receiving $130,110,401 from MSA payments in fiscal year 2004 and expects to receive $137,126,872 in fiscal year 2005. Table 50: Wisconsin's MSA Payment Allocation: Program area: Debt service on securitized funds; Fiscal year 2004 allocation: $130,110,401; Fiscal year 2005 expected allocation: $137,126,872. Total; Fiscal year 2004 allocation: $130,110,401; Fiscal year 2005 expected allocation: $137,126,872. Source: Badger Tobacco Asset Securitization Corporation. [End of table] Wyoming: Wyoming reported receiving $15,594,424 from MSA payments in fiscal year 2004 and expects to receive $15,594,424 in fiscal year 2005. Table 51: Wyoming's MSA Payment Allocations: Program area: General purposes; Fiscal year 2004 allocation: $0; Fiscal year 2005 expected allocation: $125,000; Examples of programs receiving or expected to receive allocations: Attorney General's Office--fees. Program area: Health; Fiscal year 2004 allocation: $7,305,151; Fiscal year 2005 expected allocation: $7,305,151; Examples of programs receiving or expected to receive allocations: Substance abuse treatment and prevention services. Program area: Social services; Fiscal year 2004 allocation: $4,056,823; Fiscal year 2005 expected allocation: $3,931,823; Examples of programs receiving or expected to receive allocations: Adolescence services and drug court. Program area: Tobacco control; Fiscal year 2004 allocation: $4,232,450; Fiscal year 2005 expected allocation: $4,232,450; Examples of programs receiving or expected to receive allocations: Tobacco prevention, regional prenatal programs, community tobacco prevention activities and tobacco cessation. Total; Fiscal year 2004 allocation: $15,594,424; Fiscal year 2005 expected allocation: $15,594,424. Source: Wyoming Department of Health, Substance Abuse Division. [End of table] [End of section] Appendix V: GAO Survey on States' Allocations of Fiscal Years 2004 and 2005 Master Settlement Agreement Payments: [See PDF for image] [End of figure] [End of section] Appendix VI: GAO Contact and Staff Acknowledgments: GAO Contact: Robert A. Robinson, 202-512-3841: Staff Acknowledgments: Charles M. Adams, Kim Chaffer, Lawrence J. Dyckman, Alan R. Kasdan, Stuart Kaufman, Karen K. Keegan, Julio A. Luna, Rosellen McCarthy, Judy Pagano, and Stuart Ryba: (360497): FOOTNOTES [1] Under these agreements, tobacco companies will pay these 4 states $40 billion over 25 years. [2] This company was previously known as Philip Morris Incorporated. [3] Several other tobacco companies have joined the MSA since the agreement was signed. [4] For additional information on the agreement, refer to our June 2001 report on the MSA (Tobacco Settlement: States' Use of Master Settlement Agreement Payments, GAO-01-851 (Washington, D.C.: June 29, 2001). [5] The $206 billion includes $204.5 billion in estimated total payments to the 46 states, the District of Columbia, and the five U.S. territories and an additional $1.8 billion for other initiatives agreed to in the MSA, including a national foundation dedicated to significantly reducing the use of tobacco products by youths and the administrative costs of the National Association of Attorneys General. [6] While the District of Columbia and the five U.S. territories are included in the MSA, this study reports only on the 46 states that signed the agreement. [7] GAO, Tobacco Settlement: States' Allocations of Phase II Funds, GAO- 03-262R (Washington, D.C.: Dec. 3, 2002); Tobacco Settlement: States' Allocations of Fiscal Years 2002 and 2003 Master Settlement Agreement Payments, GAO-03-407 (Washington, D.C.: Feb. 28, 2003); and Tobacco Settlement: States' Allocations of Fiscal Year 2003 and Expected Fiscal Year 2004 Payments, GAO-04-518 (Washington, D.C.: Mar. 19, 2004). [8] GAO-01-851. [9] Throughout this report, "fiscal year" refers to the state's fiscal year. In most states, the fiscal year begins on July 1 and ends on June 30. The exceptions are in Alabama and Michigan, where the fiscal year begins on October 1, and in New York, where the fiscal year begins on April 1. [10] Our study focuses on the states' share of MSA payments and does not include information on MSA payments made to counties and cities in New York and California. [11] GAO-01-851, GAO-03-407, and GAO-04-518. [12] Categories include such areas as education, health, budget shortfalls, and debt service on securitized funds. [13] The $400 million represents securitized funds that New York carried over from fiscal year 2004. The state expects to allocate an additional $182 million of its fiscal year 2005 MSA funds to address budget shortfalls. [14] Fiscal year refers to the state's fiscal year. [15] Allocation refers to funds appropriated or otherwise designated (e.g., earmarked for a trust fund or an endowment that has a specific purpose). It also includes funds designated for debt servicing on bonds issued when a state securitized all or a portion of the MSA funds. [16] See appendix V for a copy of the survey that we sent to each of the 46 states. [17] The National Association of Attorneys General monitors the actual payments made to states as determined by an independent auditor. [18] As we reported in 2001, California counties, four California cities, New York counties, and New York City each receive a share of MSA payments. [19] GAO-01-851, GAO-03-407, and GAO-04-518. GAO's Mission: The Government Accountability Office, the investigative arm of Congress, exists to support Congress in meeting its constitutional responsibilities and to help improve the performance and accountability of the federal government for the American people. GAO examines the use of public funds; evaluates federal programs and policies; and provides analyses, recommendations, and other assistance to help Congress make informed oversight, policy, and funding decisions. GAO's commitment to good government is reflected in its core values of accountability, integrity, and reliability. 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