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Big Money Means Big Decisions: Learning from the challenges some states have faced

February 7, 2023

Currently, over $54 billion has been awarded to states and localities as a result of the opioid litigation. We already know there is great variability in how states are making spending decisions. As of yet, few states have made firm decisions about which programs will be receiving money.

In some jurisdictions, community advocates have already begun pushing back on early process decisions that lack transparency and representation. Using these case studies, we explore how the Principles for the Use of Funds from the Opioid Litigation can help states and local governments avoid the same struggles.

Transparency, Communication, and Lacking Diversity

In Ohio, policymakers gave the majority of the state’s settlement allocation – around $440 million of the $808 million coming to the state – to OneOhio Recovery Foundation, a private, non-profit organization. The Foundation was created through a memorandum of understanding between the Ohio state government and participating jurisdictions.

Controversy has arisen over whether the Foundation must comply with Ohio’s laws around public meetings. Although the MOU states “meetings shall be open, and documents shall be public”, the foundation says that the open meeting laws do not apply to it because it is acting as a nonprofit, not a government agency.

Ultimately, Harm Reduction Ohio filed two lawsuits, suing the Foundation in an effort to get the Foundation to adhere to the open meeting and public records laws. One lawsuit is being heard with the Franklin County Common Pleas Court and the other with the Ohio Supreme Court. As of now, both cases are awaiting decisions in their respective courts.

Additionally, OneOhio has been accused by the Harm Reduction Ohio of lacking racial diversity and not representing the victims of the opioid epidemic. Despite Black residents making up a fifth of all opioid-related deaths, Foundation leadership is made up almost entirely by white members, with only one Black member. Harm Reduction Ohio and advocates have stated their fears that decisions made by OneOhio will not accurately depict the needs for Ohio residents most affected by the opioid crisis.

Conflict Between State Agencies and State Advisory Boards

In early 2021, former New York Governor Andrew’s Cuomo’s administration chose to transfer most of a settlement with McKinsey and Company into the state’s general fund rather than use it to fund opioid abatement efforts. Frustrated with this action, community advocates urged the legislature to step in. In response, the legislature passed a bill that requires all opioid settlement dollars to go into a special fund. Additionally, the bill required the formation of an Opioid Settlement Fund Advisory Board tasked with advising the government on the use of money from the fund.

However, conflict between the Advisory Board and the state Office of Addiction Services and Supports (OASAS) has slowed the recommendation process. In December 2022, OASAS rejected two of the Board’s recommendations on distribution of settlement funds to the Department of Health for harm reduction programs, including the use of funds to support overdose prevention centers. Substantial evidence exists regarding the efficacy of these centers. OASAS claims that the Board has no power to “direct or spend State monies”, despite the Board’s mission to recommend where and how funds from the settlements are to be spent. Instead OASAS chose to put the funds into a new state-run harm reduction unit.

Future Considerations and Strategies for States

As states continue to formulate and finalize their plans for how to use their share of the settlements, the Principles can serve as a tool to guide their process and decision-making and potentially help them avoid controversies such as what has occurred in Ohio and New York.

Principle One, Spend the Money to Save Lives, calls on jurisdictions to establish a dedicated fund in which to put all of the dollars that they get. If your jurisdiction does not yet have legislation, consider utilizing this model bill.

Principle Two, Use Evidence to Guide Spending, calls on jurisdictions to fund programs supported by evidence that will mitigate the opioid crisis and reduce its harmful effects. Juridictions should determine which evidence-based programs related to the core strategies are most needed to improve the lives of those affected by the epidemic.

Principle 5, Develop a Fair and Transparent Process for Deciding Where To Spend the Funding, calls for jurisdictions to get input from groups that touch different parts of the epidemic when developing their plans. Principle Five also calls for representation that reflects the diversity of affected communities when allocating funds.

States and local jurisdictions may want to consider consistent and continued engagement with their constituents about how they plan to use their settlement dollars. Some states have implemented procedures and ways to communicate with the public how they plan to use their opioid funds.

For example, New Hampshire requires state agencies involved with their Governor’s Commission on Alcohol and Drug Abuse Prevention to publicly report on state and federal funds they use for the opioid epidemic. North Carolina, Rhode Island, and New Jersey provide portals for residents to view data about the opioid crisis in their respective jurisdictions, as well as communicate their concerns and input on how to use the settlement funds. These strategies can help to improve transparency as decision-makers navigate the crucial decisions of how to spend their opioid settlement funds.

This post is written by Henry Larweh, a senior at the Johns Hopkins University double majoring in Public Health Studies and Biology. He is an intern on the Bloomberg Opioid Prevention Initiative’s Government Support Team working with the Principles to advise and recommend opioid mitigation policies and plans for states and local governments.