Lower Smoking Numbers May Be Bad for MSA Bonds

Albanese, Elizabeth
March 2006
Bond Buyer;3/9/2006, Vol. 355 Issue 32335, p5
Trade Publication
The article reports on a significant decline in the number of cigarettes sold in the United States in 2005. According to the National Association of Attorneys General, the drop may bode well for national health concerns, but could impact municipal tobacco bonds which are backed by payments to states under the terms of the 1998 Master Settlement Agreement. Under the terms of the agreement, tobacco manufacturers make payments based on the number of cigarettes sold in the country. The decline in sales demonstrates the largest consumption drop in a single year since 1999.


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