The CCAA conducted a financial analysis of the settlement. Readers can view this initial release here. The summary figures illustrate that New Mexicans, as well as citizens in the remaining 45 states participating in the settlement, did not get a good deal.

Based on 1993 figures, the total medical expenditures attributable to smoking amounted to an estimated $72.7 billion. The U.S. Census reports the national population as of May 12, 1999 to be 272,486,242. This means that every man, woman and child in the country pays an estimated $267 to support the costs associated with smoking-related illnesses.

For the state of New Mexico, with the population currently estimated at 1.7 million, the total medical costs sum to $453,900,000.

The illustration at the top of the page reports the per capita cigarette consumption for New Mexico between 1992 and 1996. There appears to be a gradual, linear decline in tobacco consumption. The CCAA tested this relationship. Using regression analysis, we found that a highly predictive (R2=95%) and significant (p-value less than 0.001) relationship to exist. Based on the regression equation, we formed the following conclusions: for 1998 through 2000, per capita tobacco consumption will continue to decrease, and consumption will decrease to the listed amounts. These values are provided in the table below.

The tobacco industry agreed to make a partial payment to New Mexico in 1998 of $14,313,352. They will make no payment in 1999 (why?). The first full payment comes to New Mexico in the year 2000. The amount is an estimated $38,239,016 and change. How does the settlement affect the tobacco companies? Using the information supplied in Table 1 above, we continue the analysis.