By Jim McLean
March 8, 2016
The head of a nonprofit organization that advocates for children is blowing the whistle on plans to raise some quick cash for the state treasury by selling the state’s tobacco settlement. State officials say no deal has been struck.
Shannon Cotsoradis, the president of Kansas Action for Children, says she has reason to believe that Gov. Sam Brownback wants to securitize a settlement reached decades ago to end a lawsuit against the nation’s major tobacco companies.
Kansas and several other states sued to recover the Medicaid dollars they spent caring for smokers who developed cancer, heart disease and other illnesses.
The state receives more than $50 million a year from that settlement, which it uses to fund children’s programs.
Cotsoradis says the securitization deal would forgo future revenues in exchange for a one-time payment of about $400 million.
“We would really be giving up a revenue stream that’s been dedicated to our youngest children to essentially address the fiscal crisis that the state is facing,” she says.
Brownback spokeswoman Eileen Hawley says securitizing the tobacco settlement has been discussed but she says “there is no deal or pending legislation.”