Fla. Tobacco Money Bill Passed
TALLAHASSEE, Fla. (AP) - The state Senate has passed a package of bills meant to protect the money Florida gets each year from embattled cigarette makers.
The legislation sent Tuesday to the House is aimed at addressing fears stoked by industry statements that an impending punitive damage award in a class action suit in Miami could bankrupt the tobacco companies.
Florida expects to get more than $13 billion from the industry over 25 years thanks to its 1997 settlement of a lawsuit meant to reimburse the state for treating sick smokers.
Bankruptcy filings by the tobacco companies could jeopardize the industry's settlement payments to Florida, which is counting on the money to pay for programs for children and the elderly.
One of the bills passed by the state Senate on Tuesday would cap the bond amount the companies would have to put up to appeal the damages in the Miami class action suit at $100 million, or 10 percent of their net worth.
With no debate, the Senate passed that measure 37-2, sending it to the House.
The Senate also unanimously passed measures to protect the principal that comes in from the industry by specifying that it must go to a certain fund and can't be raided except in emergencies, and to set up a task force to study the issue.
It also passed a measure to levy a new wholesale tax on all cigarette companies except those paying Florida as part of the settlement. The idea is to keep companies from going out of business only to be replaced by new companies selling cigarettes that don't have to pay into the settlement.