WHEREAS, originally it was projected that the state of Louisiana's portion from the $246 billion tobacco settlement would be approximately $4.6 billion to be paid in 25 annual payments of approximately $180 million; however, the terms of the tobacco settlement cause the actual amount each settling state receives each year to be uncertain as it is dependent on a number of variables, including the annual rate of domestic cigarette consumption;
WHEREAS, on October 23, 1999, the citizens of the state of Louisiana approved by a vote of 584,294 to 246,689 a proposition to amend the Louisiana Constitution of 1974 by adding Article VII, Sections 10.8, 10.9, and 10.10, to establish the Millennium Trust and the Louisiana Fund in the State Treasury into which portions of the monies received by the state of Louisiana as a result of the tobacco settlement are to be deposited and dedicated to the improvement of health care, higher education, and public and private elementary and secondary education in the state of Louisiana;
WHEREAS, the city of New York sold and several settling states, including the commonwealth of Virginia and the state of Florida, are in the process of pledging and/or selling all or part of their rights to receive the income stream expected from their portion of the tobacco settlement for a single lump-sum cash payment through tobacco settlement asset securitization, a bond sale financing mechanism that provides immediate cash and eliminates the risks involved in the tobacco settlement payment structure, including reduced, tardy or canceled annual payments; and
WHEREAS, prudent money management practices dictate that the best interests of the citizens of the state of Louisiana will be served by comparing the immediate lump sum value of its portion of the tobacco settlement to the value the annual payments would have if received as scheduled and in the amounts anticipated; analyzing the risks involved in the tobacco settlement payment plan, including those of reduced, tardy, or canceled annual payments; and exploring other tobacco settlement payment options, including those taken or being considered by other settling states such as tobacco settlement asset securitization;
NOW THEREFORE, I, M.J. "MIKE" FOSTER, JR., Governor of the state of Louisiana, by virtue of the authority vested by the Constitution and the laws of the state of Louisiana, do hereby order and direct as follows:
SECTION 1: The Tobacco Settlement Payment Options Task Force (hereafter "Task Force") is hereby established within the executive department, Office of the Governor.
SECTION 2: The duties of the Task Force shall include, but are not limited to, the following:
SECTION 3: The Task Force shall be composed of fourteen (14) members appointed by the governor and serving at his pleasure, selected as follows:SECTION 4: The co-chairs of the Task Force shall be the state treasurer and the commissioner of administration. All other officers shall be elected by the membership of the Task Force.
SECTION 5: The Task Force shall hold its first meeting by February 4, 2000. Thereafter, it shall meet at regularly scheduled intervals and at the call of the chair.
SECTION 6: Support staff for the Task Force shall be provided by the Division of Administration and the Department of Revenue.
SECTION 7: Task Force members shall not receive additional compensation, a per diem, or travel expenses from the Office of the Governor for their service on the Task Force.
SECTION 8: All departments, commissions, boards, agencies, and officers of the state, or any political subdivision thereof, are authorized and directed to cooperate with the Task Force in implementing the provisions of this Order.
SECTION 9: This Order is effective upon signature and shall continue in effect until amended, modified, terminated, or rescinded by the governor, or terminated by operation of law.
IN WITNESS WHEREOF, I have set my hand officially and caused to be affixed the Great Seal of Louisiana, at the Capitol, in the city of Baton Rouge on this 28th day of January, 2000.
M.J. "Mike" Foster, Jr.
Secretary of State