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Attorney General Jason R. Ravnsborg

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Tobacco Escrow Enforcement Bill Signed into Law

Tobacco Escrow Enforcement Bill Signed into Law 

(Pierre) – Yesterday, South Dakota became the first state in the nation to enact model legislation that assists in the effective enforcement of the tobacco escrow laws. “Enactment of House Bill 1034 demonstrates our commitment to diligent enforcement,” Attorney General Larry Long announced today. House Bill 1034 was signed into law by Governor Rounds yesterday. South Dakota and the states settled a lawsuit with several tobacco manufacturers in 1998. The settlement restricted the advertising and marketing of cigarettes to children and required the tobacco manufacturers to make payments to the states. South Dakota received over $50 million in direct tobacco payments and, after securitizing the payments in 2002, received an additional $243 million. South Dakota also enacted a statute provided by the settlement that requires tobacco product manufacturers not joining the settlement to pay funds into escrow. South Dakota is obligated by the securitization of its tobacco payments to diligently enforce the escrow statute. House Bill 1034 was based on model legislation. It establishes a directory of compliant manufacturers and prohibits the sale of cigarettes or roll-your-own tobacco manufactured by companies that have not complied with the escrow statutes. “This new law gives us real teeth in ensuring that all tobacco manufacturers are complying with our laws,” General Long said.