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Anaheim, CA 92805
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CITY COUNCIL AGENDA REPORT
City of Anaheim
HOUSING & COMMUNITY DEVELOPMENT
DEPARTMENT
DATE: APRIL 8, 2025
FROM: HOUSING AND COMMUNITY DEVELOPMENT DEPARTMENT
SUBJECT: APPROVE THE PROFESSIONAL SERVICES AGREEMENTS
(OPIOID SETTLEMENT FUNDING AGREEMENT) WITH KTMV
INVESTMENTS, LLC, ACTION ALLIANCE FOUNDATION, AND
THE COMMON HOUSE, INC.; AND THE CALOPTIMA HEALTH
HOUSING AND HOMELESSNESS INCENTIVE PROGRAM SUB-
RECIPIENT AGREEMENT WITH THE ELI HOME
ATTACHMENT (Y/N): YES ITEM # 12
GOVERNMENT CODE § 84308 APPLIES: YES
RECOMMENDATION:
That the City Council, by Motion:
1. Approve three Professional Services Agreements (Opioid Settlement Funding Agreement), substantially in the form attached, for recovery housing services, by and between the following:
KTMV Investments, LLC, for temporary housing services on a pay per stay basis, for a one-year term, in an amount not to exceed $50,000, with the option to renew for two additional one-year terms for a maximum compensation amount of $150,000;
Action Alliance Foundation for temporary housing services on a pay per stay basis, for a one-year term, in an amount not to exceed $100,000, with the option to renew for two additional one-year terms for a maximum compensation amount of $300,000;
The Common House, Inc., for temporary housing services on a pay per stay basis and recovery services, for a one-year term, in an amount not to exceed $150,000, with the option to renew for two additional one-year terms for a maximum compensation amount of $450,000;
2. Approve the Cal Optima Health Homeless Housing Incentive Program Subrecipient Agreement, substantially in the form attached, with The Eli Home, Inc. for shelter operations and unification in recovery services for a one-year term in an amount not to exceed $150,000; and
3. Authorize the Director of Housing and Community Development to execute the agreements and all other necessary documents to implement and administer them as long as the maximum compensation does not increase and authorize de minimis changes that do not substantially change the terms and conditions of the Cal Optima and Opioid Settlement Funds Agreements
April 8, 2025
agreements, so long as the changes are determined to be de minimis by the City Attorney’s Office.
BACKGROUND:
The City of Anaheim is one of over 3,000 original plaintiff jurisdictions comprised of states, cities, and counties in a class action lawsuit alleging that pharmaceutical manufacturers, major distributors, and pharmacies caused the national opioid crisis. The opioid crisis, described by the Centers for Disease Control and Prevention (CDC) as the “opioid epidemic” due to its rapid escalation, high mortality rates, national scale, and sustained impact, is considered one of the most devastating public health emergencies in U.S. history. According to the CDC, from 1999 – 2020, the epidemic caused over 564,000 deaths from opioid overdoses and affected over 10 million Americans through opioid misuse, with millions developing opioid use disorder (OUD).
The economic impact of the opioid epidemic was estimated at $1.5 trillion annually as of 2020 due to healthcare expenses, loss of productivity, and criminal justice costs. The community impact was equally devastating, with underserved communities disproportionately affected facing higher addiction rates and fewer resources for treatment.
This litigation resulted in an estimated settlement of $54,000,000,000 ($54 billion) to be paid to the original plaintiffs and other localities over an 18-year period commencing in 2022. In California, opioid settlement funds (OSF) are monitored for compliance by the Department of Health Care Services (DHCS). Eligible uses are restricted to opioid abatement activities as defined by the terms of the settlement agreement, with California Government Code, Title 2, Division 3, Part 2, Chapter 6, Article 2, Section 12534 designating additional High Impact Abatement Activities (HIAA) in California.
Of available settlement funding, Anaheim is projected to receive $13,783,114 over 18 years. To date, the city has received $4,712,361 of the projected funds. The Anaheim Housing and Community Development (HCD) Department is designated to receive and oversee the city's OSF.
Programming for urgent community needs started in 2023 with the Anaheim Fire Department training Anaheim schools’ faculty and staff to administer and distribute naloxone, which has already saved several lives; street-level wound care for those affected by OUD, which has reduced opioid-related deaths in Anaheim; and the implementation of supportive services agreement to support the Anaheim Collaborative Court - Evaluation Strategies and Solutions (ACCESS) in 2024. Currently, City staff are working with multiple departments to recruit an additional paramedic fire captain, nurse practitioner, and mental health clinician using the OSF to promote local abatement activities.
DISCUSSION:
The opioid epidemic exacerbated homelessness across the nation, including Anaheim, which has created a disproportionate need compared to the rest of the community.
Individuals struggling with opioid addiction often face job loss, family disruption, and financial difficulties, all of which increase the risk of losing housing. Untreated addiction can make it difficult to secure and maintain stable employment or housing, creating a Cal Optima and Opioid Settlement Funds Agreements
April 8, 2025
feedback loop that increases homelessness. Homelessness also compounds the challenges of addiction, as individuals living without stable shelter often encounter barriers to accessing healthcare and treatment. This also causes community safety concerns and a revolving cycle in the justice system. These individuals are at a higher risk of overdose and related health complications due to exposure to unsafe conditions and limited access to harm-reduction services.
According to Orange County Health Care Agency, opioid-related deaths nearly tripled from 7.9 deaths per 100,000 residents in 2017 to 23.2 per 100,000 residents in 2021. More recently, deaths among people experiencing homelessness in Orange County, where Fentanyl significantly contributed to the cause of death, increased by 50% between 2020 and 2023, according to the Orange County Sheriff’s report.
The strain on local resources, such as shelters, emergency responders, and hospitals, highlights the need for approaches that address both addiction and homelessness, with a focus on prevention, recovery, and long-term housing stability while also protecting community and public spaces for their intended purpose. To address the urgent need at the intersection of OUD and homelessness in the city, a request for proposal (RFP) was released on November 8, 2024, soliciting sober living environments and recovery housing options where the city would assist with payments related to placement and rental assistance in such interventions. This RFP and the issuance of these funds will not be used to create new sober living facilities. Instead, the goal is to secure access to beds on an as- needed basis within existing facilities throughout Orange County.
The RFP also aimed to 1) support the ACCESS program’s expansion and its participants 2) increase access to services for underserved sub-populations, 3) assist people experiencing homelessness and those at risk of falling into homelessness who are not justices involved, but unable to obtain beds on their own, and 4) support the recovery journeys of those exiting medically assisted detoxification treatment.
An evaluation panel made up of staff from the Grants and Homeless Initiatives team and the Housing Authority, both part of the HCD Department, reviewed the six responses received through this solicitation. The staff participating on the panel is the most familiar with Anaheim’s Homeless System of Care, housing programs, and the eligible uses of Opioid Settlement Funds, ensuring a well-informed review process. Two responses were deemed unresponsive, and the remaining four proceeded to interviews. After careful consideration, the panel proposed to award all four respondents due to the unique sub- population each serves. These proposed awardees—KTMV Investments, LLC, Action Alliance Foundation, The Eli Home, and The Common House, Inc.—are all currently certified under the Orange County Sheriff’s Department Certification Program or the California DHCS.
Through these awards, the city will secure beds and recovery services within existing facilities for:
People affected by OUD who typically don’t accept treatment and indoor shelter because of the risk of separation from their pets
People affected by OUD who don’t require medically assisted treatment and who can be placed directly from the streets
Cal Optima and Opioid Settlement Funds Agreements
April 8, 2025
Women working through court-ordered reunification plans before and after reunification with their children while addressing their OUD Women exiting medically assisted treatment facilities who require structured recovery programming
ACCESS program participants, all of whom are justice-involved People affected by OUD who are not justice-involved
Under this RFP, eligible individuals affected by OUD with and without co-occurring mental health conditions will be eligible for a six-month stay, with two additional 6-month extensions available with a recommendation from a case manager or clinician. These services will be referred through the ACCESS program staff, street outreach service providers, and Homeless Assessment Liaison Officers (HALO). The length of stay was determined by the understanding that OUD and co-occurring mental health conditions vary greatly and that some individuals may require extended stay to work through individual care plans or meet personal self-sufficiency goals.
The City intends to execute one-year agreements with three of the community-based organizations, with the option to renew for two additional years, as outlined below.
Funding Recommendations
1-Year
Allocation Source Individuals Served
Action Alliance $100,000.00 OSF 6-33*
KTMV Investments, LLC $50,000.00 OSF 4-22*
The Common House, Inc. $150,000.00 OSF 4-7*
The Eli Home (not renewable) $150,000.00 HHIP Up to 3
*Depends on the length of stay.
The services outlined in these agreements will be funded through a combination of Opioid Settlement Funds (OSF) and the CalOptima Health Housing and Homelessness Incentive Program (HHIP) Grant. The use of OSF is restricted to opioid abatement activities, as defined by the terms of the national settlement agreement, ensuring funds are directed toward prevention, treatment, and harm reduction efforts related to opioid use disorder (OUD). Additionally, the CalOptima HHIP grant is specifically targeted to provide support for Anaheim Collaborative Court - Evaluating Strategies and Solutions (ACCESS) program participants, expanding access to stable recovery housing and supportive services for justice-involved individuals with OUD.
This recommendation aligns with the State of California’s High-Impact Abatement Activities, Anaheim’s Homeless System of Care, and the City’s Strategic Plan Goal B:
Enhance Livability.
IMPACT ON BUDGET:
The Housing and Community Development Department FY 2024/25 includes funds for the proposed activities. There is no impact on the City’s general fund.
Cal Optima and Opioid Settlement Funds Agreements
April 8, 2025
Respectfully submitted,
Grace Ruiz-Stepter
Housing and Community Development Director
Attachments:
1. KTMV Investments, LLC OSF Professional Services Agreement
2. Action Alliance Professional Services Agreement
3. The Common House, Inc. OSF Professional Services Agreement
4. The Eli Home HHIP Subrecipient Agreement