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Brownback Calls for Tobacco Settlement Securitization

Kansas governor wants to use the money from the tobacco settlement to help erase a projected state budget deficit.

Governor Sam Brownback is urging lawmakers to exchange annual payments from the state’s tobacco settlement for a one-time payout of hundreds of millions of dollars. The budget Brownback laid out for lawmakers yesterday (WED) – calls for “securitizing” an agreement that Kansas reached with tobacco companies in the 1990s. Doing so could generate a payout of between $500 and $800 million. Lawmakers rejected a similar pitch last year and House Majority Leader Don Hineman says they’re likely to say “no” to the proposal again this year.

Brownback wants to use the money from the tobacco settlement securitization to help erase a projected deficit in next year’s budget. Many lawmakers and children’s advocates say the deal would shortchange the state in the long run and jeopardize funding for a host of early education programs.

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