Md. Code, State Fin. & Proc. § 7-317

Current with changes from the 2024 Legislative Session

Section 7-317 - [Effective 7/1/2025] [Effective Until 6/30/2025] Cigarette Restitution Fund

(a) There is a Cigarette Restitution Fund.

(b)

(1) The Fund is a continuing, nonlapsing fund that is not subject to § 7-302 of this subtitle.

(2) Subject to subsections (h) and (i) of this section, there shall be credited to the Fund all revenues consisting of funds received by the State from any source resulting, directly or indirectly, from any judgment against or settlement with tobacco product manufacturers, tobacco research associations, or any other person in the tobacco industry relating to litigation, administrative proceedings, or any other claims made or prosecuted by the State to recover damages for violations of State law.

(3) There shall be credited to the Fund all money collected under § 24-508 of the Health - General Article or § 5-608 of the Labor and Employment Article.

(c) The Treasurer shall:

(1) invest and reinvest the Fund in the same manner as other State funds; and

(2) credit any investment earnings to the Fund.

(d) Expenditures from the Fund shall be made by an appropriation in the annual State budget.

(e)

(1) The Fund shall be expended subject to any restrictions on its use or other limitations on its allocation that are:

(i) expressly provided by statute;

(ii) required as a condition of the acceptance of funds; or

(iii) determined to be necessary to avoid recoupment by the federal government of money paid to the Fund.

(2) Except as otherwise provided under subsection (h) of this section, disbursements from the Fund to programs funded by the State or with federal funds administered by the State shall be used solely to supplement, and not to supplant, funds otherwise available for the programs under federal or State law as provided in this section.

(f)

(1) The Cigarette Restitution Fund shall be used to fund:

(i) the Tobacco Use Prevention and Cessation Program established under Title 13, Subtitle 10 of the Health - General Article;

(ii) the Cancer Prevention, Education, Screening, and Treatment Program established under Title 13, Subtitle 11 of the Health - General Article;

(iii) the activities of the Southern Maryland Agricultural Development Commission, in accordance with § 13-611 of the Economic Development Article;

(iv) For each of fiscal years 2025 through 2029, the Maryland Community Health Resources Commission Fund, in accordance with subsection (g) of this section;

(v) the public education campaign on prostate, lung and breast cancer prevention established under Title 13, Subtitle 11A of the Health - General Article; and

(vi) other programs that serve the following purposes:

1. reduction of the use of tobacco products by individuals under the age of 21 years;

2. implementation of the Southern Maryland Regional Strategy-Action Plan for Agriculture adopted by the Tri-County Council for Southern Maryland with an emphasis on alternative crop uses for agricultural land now used for growing tobacco;

3. public and school education campaigns to decrease tobacco use with initial emphasis on areas targeted by tobacco manufacturers in marketing and promoting cigarette and tobacco products;

4. smoking cessation programs;

5. enforcement of the laws regarding tobacco sales;

6. the purposes of the Maryland Health Care Foundation under Title 20, Subtitle 5 of the Health - General Article;

7. primary health care in rural areas of the State and areas targeted by tobacco manufacturers in marketing and promoting cigarette and tobacco products;

8. prevention, treatment, and research concerning cancer, heart disease, lung disease, tobacco product use, and tobacco control, including operating costs and related capital projects;

9. substance abuse treatment and prevention programs; and

10. any other public purpose.

(2) The provisions of this subsection may not be construed to affect the Governor's powers with respect to a request for an appropriation in the annual budget bill.

(g)

(1) Amounts may only be expended from the Fund through appropriations in the State budget bill as provided in this subsection.

(2) The Governor shall include in the annual budget bill appropriations from the Fund equivalent to the lesser of $100,000,000 or 90% of the funds estimated to be available to the Fund in the fiscal year for which the appropriations are made.

(3) For each fiscal year for which appropriations are made, at least 50% of the appropriations shall be made for those purposes enumerated in subsection (f)(1)(i), (ii), and (vi)1 through 9 of this section subject to the requirement of subsection (e)(2) of this section.

(4) For each fiscal year for which appropriations are made, at least 30% of the appropriations shall be made for the purposes of the Maryland Medical Assistance Program.

(5) For each fiscal year for which appropriations are made, 0.15% of the Fund shall be appropriated for the purposes of enforcement of Title 16, Subtitle 5 of the Business Regulation Article.

(6) For each of fiscal years 2025 through 2029, the Governor shall include in the annual budget bill an appropriation of $8,000,000 to the Maryland Community Health Resources Commission Fund.

(7) Any additional appropriations, not subject to paragraph (3), (4), or (5) of this subsection, may be made for any lawful purpose.

(h)

(1) The Fund shall include a separate account consisting of payments received by the State as a result of litigation by participating manufacturers related to the State's diligent enforcement of Title 16, Subtitle 4 of the Business Regulation Article.

(2) Distributions from the separate account may be used only to supplant the General Fund appropriation to the historically black colleges and universities required under § 15-126 of the Education Article.

(i)

(1) The Fund shall include a separate account consisting of payments received by the State from any judgment, settlement, penalty, offer of compromise, or any other enforcement action related to the sale and marketing of electronic smoking devices.

(2) Distributions from the separate account established under paragraph (1) of this subsection may be used, consistent with any other provision of State law, to supplement the General Fund appropriations designated for programs under subsection (f) of this section with the purpose of reducing the use of tobacco products by individuals under the age of 21 years.

(j) For each program, project, or activity receiving funds appropriated under subsection (g)(3) of this section, the Governor shall:

(1) develop appropriate statements of vision, mission, key goals, key objectives, and key performance indicators and report these statements in a discrete part of the State budget submission, which shall also provide data for key performance indicators; and

(2) report annually, subject to § 2-1257 of the State Government Article, to the General Assembly no later than December 1 on:

(i) total funds expended, by program and subdivision, in the prior fiscal year from the Fund established under this section; and

(ii) the specific outcomes or public benefits resulting from that expenditure.

Md. Code, SF § 7-317

Amended by 2024 Md. Laws, Ch. 812,Sec. 1, eff. 7/1/2025.

Amended by 2023 Md. Laws, Ch. 348, Sec. 1, eff. 10/1/2023.

Amended by 2023 Md. Laws, Ch. 48, Sec. 1, eff. 6/1/2023.

Amended by 2023 Md. Laws, Ch. 47, Sec. 1, eff. 6/1/2023.

Amended by 2022 Md. Laws, Ch. 187, Sec. 1, eff. 7/1/2022.

Amended by 2021 Md. Laws, Ch. 109, Sec. 1, eff. 4/13/2021.

Amended by 2021 Md. Laws, Ch. 42, Sec. 1, eff. 3/24/2021.

Amended by 2021 Md. Laws, Ch. 41, Sec. 1, eff. 3/24/2021.

Amended by 2019 Md. Laws, Ch. 396, Sec. 1, eff. 10/1/2019.

Amended by 2015 Md. Laws, Ch. 58, Sec. 1, eff. 6/1/2015.

2021 Md. Laws, Ch. 42, Sec. 6, and 2021 Md. Laws, Ch. 41, Sec. 6eff. 3/24/2021, provide:

(a) Section 1 of this Act is contingent on the execution of a final settlement agreement in the case of The Coalition for Equity and Excellence in Maryland Higher Education v. Maryland Higher Education Commission, 06-CV-02773-CCB (D. MD) on or before June 1, 2021, that :

(1) incorporates and does not exceed the financial and programmatic commitments contained in Section 1 of this Act; (2) incorporates the order described in subsection (d)(2) of this section; and

(2) incorporates the order described in subsection (d)(2) of this section; and

(3) provides for attorney's fees and expenses in an amount not less than $14,000,000 but not more than $25,000,000 to plaintiffs' counsel in The Coalition for Equity and Excellence in Maryland Higher Education v. Maryland Higher Education Commission, 06-CV-02773-CCB (D. MD).

(b)(1) In fiscal year 2023, the Governor shall provide an allocation for the attorney's fees and expenses in the amount specified in the final settlement agreement described in subsection (a) of this section.

(2) The amount allocated under paragraph (1) of this subsection shall be provided from the funds for the historically black colleges and universities under Section 1 of this Act, with the amounts allocated based on each institution's share of the total funds provided under Section 1 of this Act.

(3) Notwithstanding § 12-501 of the State Government Article or any other provision of law, the settlement agreement as provided in subsection (a) of this section, including attorney's fees and expenses provided in the settlement agreement, are not subject to approval by the Board of Public Works.

(1) is authorized to execute the final settlement agreement in subsection (a) of this section on behalf of the State on terms the Attorney General deems:

(i) as final resolution of the case of The Coalition for Equity and Excellence in Maryland Higher Education v. the Maryland Higher Education Commission, 06-CV-02773-CCB (D. MD); and

(ii) appropriate to carry out the purposes of Section 1 of this Act; and

(2) shall provide written notice of the executed settlement agreement to the Department of Legislative Services, 90 State Circle, Annapolis, MD 21401.

(d) Section 1 of this Act, with no further action required by the General Assembly, shall be null and void if, on or before June 11, 2021:

(1) the Department of Legislative Services has not received notice of the settlement agreement; and

(2) an order has not been issued from the United States District Court for the District of Maryland or the United States Court of Appeals for the Fourth Circuit that:

(i) reverses or vacates the District Court's holding that the State failed to eliminate traceable de jure era policy of unnecessary program duplication; or

(ii) holds that any policy of unnecessary program duplication traceable to de jure segregation has been cured by the terms of the settlement agreement.

This section is set out more than once due to postponed, multiple, or conflicting amendments.