The state is still shut down; but the deal is getting closer to being signed. Apparently, it's all about $700 million now for a budget gap of $5 billion. The state is betting on tobacco payments in the future to pay for budget shortfall now. It's essentially the same thing as a "payday loan," something many states find great disfavor with in the private sector.
The deal could cost the state $500 million. That includes interest payments and other costs. So, the state gets $700 million now. But the state will have to pay $1.2 billion down the road.
Another way to look at it: The state takes $700 million in tobacco settlement money, and because of interest and fees, receives only $200 million.
No comments:
Post a Comment