Ohio looks to be next on the list of state governments securitizing their share of the $200 billion national tobacco settlement. The Buckeye State is considering a deal that, if approved, could provide a massive payday to underwriters and a large chunk of new tobacco-related ABS.

The state's overall share of the Master Settlement Agreement with cigarette manufacturers is estimated to be in the $18 billion range, and the Republican-controlled state legislature last week appeared to be close to approving Gov. Ted Strickland's plan to securitize all future payments in the settlement, which Ohio will receive annually over the next 40 years. The proposal passed the state house of representatives unanimously and now faces what observers said should be an easy vote in the state senate.

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