§ 1399-nn. Findings and purpose. 1. Cigarette smoking presents serious
public health concerns to the state and to the citizens of the state.
The Surgeon General has determined that smoking causes lung cancer,
heart disease and other serious diseases, and that there are hundreds of
thousands of tobacco-related deaths in the United States each year.
These diseases most often do not appear until many years after the
person in question begins smoking.

2. Cigarette smoking also presents serious financial concerns for the
state. Under certain health-care programs, the state may have a legal
obligation to provide medical assistance to eligible persons for health
conditions associated with cigarette smoking, and those persons may have
a legal entitlement to receive such medical assistance.

3. Under these programs, the state pays millions of dollars each year
to provide medical assistance for these persons for health conditions
associated with cigarette smoking.

4. It is the policy of the state that financial burdens imposed on the
state by cigarette smoking be borne by tobacco product manufacturers
rather than by the state to the extent that such manufacturers either
determine to enter into a settlement with the state or are found
culpable by the courts.

5. On November twenty-third, nineteen hundred ninety-eight, leading
United States tobacco product manufacturers entered into a settlement
agreement, entitled the "Master Settlement Agreement," with the state.
The master settlement agreement obligates these manufacturers, in return
for a release of past, present and certain future claims against them as
described therein, to pay substantial sums to the state (tied in part to
their volume of sales); to fund a national foundation devoted to the
interests of public health; and to make substantial changes in their
advertising and marketing practices and corporate culture, with the
intention of reducing underage smoking.

6. It would be contrary to the policy of the state if tobacco product
manufacturers who determine not to enter into such a settlement could
use a resulting cost advantage to derive large, short-term profits in
the years before liability may arise without ensuring that the state
will have an eventual source of recovery from them if they are proven to
have acted culpably. It is thus in the interest of the state to require
that such manufacturers establish a reserve fund to guarantee a source
of compensation and to prevent such manufacturers from deriving large,
short-term profits and then becoming judgment-proof before liability may
arise.