Skip to main content

Minnesota sells $757 million in tobacco bonds

The state plans to repay the bonds through future money from the tobacco settlement. The decision to sell the bonds played a key role in resolving the budget crisis that led to the state's historic government shutdown this summer.
  • Author:
  • Updated:
    Original:

The state of Minnesota has completed the sale of $757 million in bonds, which it plans to repay through future money from a tobacco lawsuit settlement.

The decision to sell the bonds played a key role in resolving the budget crisis that led to the historic government shutdown this summer. But, as Politics in Minnesota reports, it hasn't been the most popular plan. Some critics worry it could lead to a pattern of borrowing to fill the state's general fund. Others don't feel the state should be tapping into the tobacco settlement money to plug the budget gap.

The Associated Press says paying back bondholders will cost the state about $1.2 billion over the next two decades.

Next Up

Kim Crockett

GOP candidate Kim Crockett won't commit to accepting election result

Crockett has been a proponent of conspiracy theories regarding the 2020 presidential election.

Screen Shot 2022-10-01 at 9.41.39 AM

Charges: Man carjacked father, daughter as they loaded groceries outside Cub

The father grappled with the suspect after he had pointed a gun at his daughter.

Screen Shot 2022-10-02 at 8.25.27 PM

Pilot, brother and sister killed when plane crashed into house are ID'd

The plane crashed into a house in Hermantown, Minnesota.

Screen Shot 2022-10-02 at 7.18.52 PM

Rolled semi, livestock on freeway interchange in Woodbury

Traffic cameras showed what appeared to be hogs on the side of the road.

Eric Reinbold

Reinbold guilty of murdering wife with 'particular cruelty'

Eric Reinbold, 46, was convicted of two counts of murder in the second degree in Pennington County Friday.

police tape

Armed assault suspect arrested after standoff in Waite Park

The standoff ended early Saturday when officer obtained a warrant for the home.

Screen Shot 2022-10-02 at 9.06.25 AM

3 dead after plane crashes into house in Hermantown

Two people in the house were uninjured.

FeDh7pUWAAg3NMd

Destructive fire at Maple Grove greenhouse and nursery

The fire burned early Sunday morning at a longtime Maple Grove greenhouse and nursery.

st. cloud state university hockey

SCSU player hospitalized after being taken off ice on stretcher

Luedtke was checked into the boards in the first period and down for a reported 10-15 minutes.

Amber alert wisconsin

Amber Alert for Kryssy King canceled, suspect still at large

Police beleived 15-year-old Kryssy King was with a 22-year-old man who remains wanted.

Screen Shot 2022-10-01 at 10.18.12 AM

3 St. Paul fast food restaurants robbed in space of an hour

The thieves struck between 7:15 p.m. and 8 p.m.

Related

DFL lawmakers: No more borrowing against the state's tobacco settlement

One method off the table -- selling more tobacco bonds. House Democrats say the state cannot borrow against its multi-billion dollar tobacco settlement again.

Minnesota to give up $1B in tobacco bonds to plug budget deficit

The state government will only get about half of that sum by asking for the money now in order to temporarily plug the state's budget deficit. Gov. Mark Dayton and lawmakers voted to borrow against the tobacco money in order to avoid tax increases and additional spending cuts.

Court ruling means lower interest payments on state bonds

Minnesota’s Management and Budget Commissioner Jim Schowalter tells the Pioneer Press a state Supreme Court decision on refinancing bonds "will save Minnesota taxpayers tens of millions of dollars." The justices ruled the state can use future revenue from its 1998 settlement with tobacco companies.

State sells $769M in bonds for building, road projects

The bonds were sold at a historic low interest rate of 2.82 percent. The sale now brings the state’s bond debt total just under $6 million.

Minnesota tax revenues $100 million higher than projected

Minnesota Management and Budget officials say revenue from both income and sales tax are more than originally forecast. The latest projections in February showed Minnesota had a $323 million surplus.

Senators pass $566 million bonding bill

The borrowing plan, approved by a 45-22 vote Monday night, would use $496 million for public works projects, higher education and state Capitol renovations. It also calls to spend an additional $50 million on unnamed Department of Employment and Economic Development projects. House lawmakers approved a similar measure early Monday afternoon. They can either accept the Senate version or the differences will be negotiated in a conference committee.

Republicans introduce bill to raise tobacco tax

A bill from two senators would raise the tobacco tax from 35 percent to more than 47 percent. The money would go toward the state's general fund.