Where Has All the Tobacco Money Gone?

Nov. 4, 2005 — -- Less than three percent of the $250 billion settlement between the tobacco companies and the fifty states has been used to fund anti-smoking campaigns.

When the tobacco industry settled out of court with the 50 states seven years ago this month, state officials said the money would be used to prevent kids from starting to smoke.

Yet, in Virginia, a large portion of the tobacco money has been used to improve an auto speedway while in New York, it was invested in a golf course sprinkler system.

New tobacco warehouses were built with the money in North Carolina, and in Lincoln, Neb., officials used the money to enforce the pooper-scooper law. In Kentucky, cattle farmers received the money through farm subsidies.

"Everything except getting our kids not to smoke," said Joseph Califano, former secretary of health, education, and welfare during the late 1970s. "And it's a tragedy."

Despite what officials -- including Connecticut Attorney General Richard Blumenthal -- promised in 1998, 97 percent of the funds won by the states from the tobacco companies went for anything but anti-smoking campaigns.

"We need to use the tools and resources that this agreement will give us to enter a new phase in this campaign," Blumenthal said in 1998.

Since then, his state has ranked the sixth lowest in spending on anti-smoking campaigns.

"I am embarrassed and outraged that our state has been virtually dead last in using the money as it was designed to do," said Blumenthal.

In Buffalo, N.Y., county officials chose to take less than half what they were due so that they could receive all of the money up front. According to County Executive Joe Giambra, most of that money has since gone to fund civic improvements.

"Not a penny," Giambra said of the tobacco money. "We have not spent any money specifically from this settlement agreement."

The few states that have used the money for aggressive anti-smoking campaigns have seen successful results.

Florida created anti-smoking commercials, including one in which smoking wins a mock award for causing the most deaths in a year.

"They showed a 38 percent drop in teenage smoking, the most dramatic drop in the country," said former health secretary Califano.

After only a few years, however, the Florida legislature drastically cut the money for the campaign from $70 million a year to $1 million a year.

"We've lost over these years hundreds of thousands of kids who have become addicted to cigarettes, who we know we could have kept off if the governments of the states had invested that money in tough prevention programs," said Califano.

ABC News' David Scott and Avni Patel contributed to this report.