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Department of Justice provides conservative Tobacco Master Settlement estimates — warns uncertainty remains
Summary
The Department of Justice told the Ways and Means committee it estimates New Hampshire’s MSA receipts will fall in coming years — roughly $35.5 million in 2025, $32.5 million in 2026 and $30.0 million in 2027 — but stressed those numbers are uncertain due to volume declines, NPM adjustments and potential manufacturer withholdings.
The New Hampshire Department of Justice briefed the House Ways and Means committee on the state’s expected Tobacco Master Settlement Agreement (MSA) receipts and the factors that make payment estimates uncertain.
Assistant Attorney General Warren Cormack, who oversees the MSA work for the state, explained that the annual national MSA payment begins with a base amount that is adjusted for inflation (3% assumed base), for changes in cigarette sales volume nationwide, for the proportion of sales by nonparticipating manufacturers (NPMs), and for other contractual adjustments. New Hampshire receives an allocation that historically has been about 0.65% of the adjusted national payment; that allocation percentage is stable year to year.
Cormack provided illustrative estimates: approximately $35.5 million for 2025, about $32.5 million for 2026 and roughly $30.0 million for 2027. He emphasized the estimates’ uncertainty: manufacturers can withhold disputed portions of payments under the MSA, companies may cease operations, and NPM adjustments can reduce states’ shares. New Hampshire has settled previous NPM disputes for recent years, which has increased stability in payments, but those settlements must be renewed or extended to cover future years.
Committee members asked about drivers of the downward trend; Cormack cited the long‑term decline in aggregate cigarette sales volume and noted that the COVID period produced atypical behavior in sales. He also said he could provide additional data—such as the market share of participating vs. nonparticipating manufacturers—on request.
Cormack cautioned that while he can produce projected figures, the MSA formula and potential withholdings make precise forecasting difficult. He described the estimates as “rough” and recommended treating them with caution in budget planning.
