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State gets payment for education trust fund

PIERRE — South Dakota’s Education Enhancement Trust Fund has added over $7.7 million to its principal, thanks to the state’s management of its master settlement agreement with major tobacco companies.

Each year, South Dakota receives payments due under the 1998 master settlement agreement among major tobacco companies and 46 states, including South Dakota. In 2002, the state created the trust fund with bonds issued by Educational Enhancement Funding Co. The state pledged future master settlement payments to pay principal and interest on the bonds in exchange for a large lump-sum payment, which was used to create the trust fund.

The EETF currently contains nearly $480 million in bond proceeds, master settlement payments and investment earnings. State law requires that 4 percent of the market value of the trust fund be used each fiscal year to enhance education in South Dakota.

— Source: Office of the Governor