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Colorado’s unusual approach to the litigation money

May 24, 2022

States have significant discretion in how they distribute the funds from the opioid litigation. The settlements with the opioid distributors and Johnson & Johnson require that at least 15% of the dollars go to local governments. However, many states have reached agreements with localities that will give them much more than 15%.

In anticipation of funds from the opioid litigation, state and local leaders in Colorado spent close to two years developing a plan for how best to distribute the dollars. Ultimately, they decided to use a regional approach for most of the new dollars. Of the approximately $400 million that Colorado will receive over 18 years:

  • 60% will go to regions (Colorado organized 19 regions in the statewide agreement);
  • 20% will go to local governments (local governments can opt-out of receiving their 20% directly and instead send the funds to their region) ; 
  • 10% will be used by the state to fund local and regional infrastructure projects; and
  • 10% will go to the state Attorney General custodial fund for projects of statewide concern.

The agreement also set up the statewide Colorado Opioid Abatement Council, with members appointed by local governments and by the Attorney General, to advise the state on how to use its share of the money. Each region will also establish a Regional Opioid Abatement Council to determine the best allocation of funds within the region. Consistent with recommendations from the opioid litigation principles, all of the funds must be spent on programs and infrastructure that will address the opioid epidemic, with public accounting for how the dollars are spent. 

More information is available on the Attorney General’s website.