Cordray praises Ohio SC ruling

Keith Loria Dec. 28, 2010, 10:13am

COLUMBUS, Ohio (Legal Newsline) - Ohio Attorney General Richard Cordray expressed pleasure on Wednesday over unanimous Ohio Supreme Court decision that will enable the state to reallocate nearly $260 million from tobacco programs to other state programs.

Thanks to the ruling, the state can use the money that was originally earmarked for tobacco programs for Medicaid programs and other health and child assistance programs.

"In response to the worst economy since the Great Depression, the general assembly redirected some $260 million from anti-smoking programs to crucial economic and medical assistance programs," Cordray said. "After two years of tumultuous litigation, we can finally get this money out to assist struggling Ohioans."

The state of Ohio was one of 46 states that signed the Tobacco Master Settlement Agreement in 1998. It has an estimated worth of $246 billion.

The money was allocated to things such as an anti-tobacco agency and research initiatives. Ten years later, the general assembly passed a bipartisan measure that dissolved the anti-tobacco agency and reallocated the fund, but reserved $40 million so that the Department of Health could continue its anti-tobacco programs.

The state was sued by two ex-smokers and an out-of-state corporation alleging that the anti-smoking money was in a protected trust, so the legislature shouldn't have had the authority to reallocate money for other uses.

Although a lower court stopped the State from touching the $260 million, the court of appeals sided with the state and the decision by the Ohio Supreme Court unanimously affirmed that decision.

Under terms of the court's ruling, the funds are, and always have been, the State's money. The court also ruled that no trust was created.

"The general assembly had the power to change the use of the settlement money," Justice Paul Pfeifer said, writing for the court, adding that, after evaluating Ohio's budget priorities.

"It is not for us to judge the wisdom of the general assembly but to determine whether the exercise of its power comports with or violates the Ohio Constitution."

The entire $260 million has been unfrozen and is now available to assist struggling Ohioans and their communities in accordance with the general assembly's legal directives.

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