The major tobacco companies sent a payment of nearly 43-million dollars to Iowa Tuesday in the latest installment of the tobacco settlement. Nearly half of that payment was in question for a time as the Philip Morris company said it might not be able to pay. Iowa Attorney General Tom Miller says the company’s concern surrounded another judgment against them. He says there was a question of whether Philip Morris would have to post a 12 billion dollar appeal bond for a large judgment against them. He says an agreement was reached on the appeal bond, and Philip Morris was able to pay. The state sold the rights to 78 percent of its portion of the tobacco settlement to bondholders, which Miller says somewhat protects future payments to Iowa. Miller says there is concern about the tobacco companies’ ability to pay in the future. He says one thing worth considering is a standby statute that would increase the tobacco taxes if the tobacco companies can’t pay. Miller says it’s hard to know the exact financial standing of the tobacco companies. He says they make significant amounts of money on an ongoing basis, but he says there’s a question as to whether the companies can continue paying if they face more large judgments against them. The latest payment brings the total paid to the state from the settlement to over 250-million dollars. The state is scheduled to be paid two billion by the time the payments are completed in the next 20 years.
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