Agenda Item
City Council
Item #: 3.11. 9/12/2023 File #: 23-0591
TO: Honorable Mayor and Members of the City Council
THRU: Tom Kisela, City Manager
FROM: Sean deMetropolis, Fire Chief
1. SUBJECT
Appropriation of $124,320.43 in National Opioid Settlement funds from California’sState-Subdivision Agreements.
2. SUMMARY
The City of Orange has received two initial settlement payments totaling $124,320.43 as a result of the National Opioid Settlements and California State-Subdivision Agreements with Janssen Pharmaceuticals and Johnson & Johnson, pharmaceutical distributors McKesson, Cardinal Health, and AmerisourceBergen, opioid manufacturers Teva and Allergan, and pharmacies Walgreens, Walmart, and CVS.
3. RECOMMENDED ACTION
1. Accept into the City’s revenue budget $124,320.43 in National Opioid Settlement funds from California’sState-Subdivision Agreements, into revenue account number 100.3015.43440.30227, General Fund - Opioid Funds.
2. Authorize the appropriation of $124,320.43 into expenditure account number 125.3015.53510.30227, EMT Transport, Fire/Paramedic Medical Supplies- Opioid Funds.
4. FISCAL IMPACT
The total appropriations for the received settlement funds are funded by additional revenue received from California State-Subdivision Agreements from the National Opioid Settlements.
5. STRATEGIC PLAN GOALS
Goal 1: Provide for a safe community
a. Provide staffing and resources to deliver services that ensure public safety. e. Develop and implement effective community outreach services and programs to promote public safety.
6. DISCUSSION AND BACKGROUND
In 2022, California Attorney General Rob Bonta announced the final settlement agreements with prescription opioid manufacturer Janssen Pharmaceuticals and Johnson & Johnson (collectively “Janssen”)and pharmaceutical distributors McKesson, Cardinal Health, and AmerisourceBergen (collectively, Distributors). In 2023, Attorney General Bonta announced proposed multistate settlements with opioid manufacturers Teva and Allergan, and pharmacies Walgreens, Walmart, and CVS (collectively, Pharmacies). These settlements mark the culmination of years of negotiations to City of Orange Printed on 9/7/2023Page 1 of 2
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Item #: 3.11. 9/12/2023 File #: 23-0591
CVS (collectively, Pharmacies). These settlements mark the culmination of years of negotiations to resolve more than 3,000 opioid-related lawsuits from state and local governments across the country and will provide substantial funds for the abatement of the opioid crisis in California.
California and its cities and counties stand to receive up to $1.8 billion for substance use prevention, harm reduction, treatment, and recovery from Teva, Allergan and the Pharmacies. This is in addition to the up to $2.2 billion California is expected to receive from the Janssen and Distributors settlements. Payment timeframes vary by settlement and can last up to 18 years. Funds from these settlements must be spent on opioid remediation activities focused on prevention, intervention, harm reduction, treatment, and recovery services in California communities. Funds from this settlement may be rolled over from year to year and must be expended or encumbered within five (5) years of receipt, or seven (7) years of receipt for capital outlay projects. Encumbered funds not expended within the five-year or seven-year timeframes must be reported to DHCS and returned to the state.
In August 2023, the City of Orange received two initial settlement payments totaling $124,320.43.
The Fire Department will allocate funds from this settlement towards high-impact activities for vulnerable populations, including interventions to prevent drug overdoses and addiction, acquiring essential treatment and transfer equipment, and procuring naloxone to increase access to opioid overdose reversals throughout the community. Staff recommends acceptance of revenue and appropriation of expenditures to Civil Penalty Settlements revenue account 100.3015.43440.30227.
7. ATTACHMENTS
· None
City of Orange Printed on 9/7/2023Page 2 of 2
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