Report Prepared by: Jose Barajas, Lieutenant, Police Department
Title
SUBJECT: Approval of a Supplemental Appropriation in the General Fund of Unspent Funding Received Through the National Opioid Settlement Program Plus Interest in the Amount of $199,452.04 for Opioid Abatement Program Expenditures
REPORT IN BRIEF
Consider approving a Supplemental Appropriation in the General Fund of Unspent Funding Received Through the National Opioid Settlement Program plus interest in the amount of $199,452.04 for Opioid Abatement Program Expenditures.
RECOMMENDATION
City Council - Adopt a motion:
A. Approving a Supplemental Appropriation of $199,453 from National Opioid Settlement plus interest in the General Fund-Police Department; and,
B. Authorizing the acceptance of any future Opioid Settlement revenues and appropriating those amounts for Opioid Abatement program expenditures; and,
C. Authorizing the Finance Officer to make necessary budget adjustments; and,
D. Authorizing the City Manager to execute the necessary documents.
Body
ALTERNATIVES
1. Approve, as recommended by staff; or,
2. Approve, subject to conditions other than recommended by staff (identify specific findings and/or
conditions amended to be addressed in the motion); or,
3. Deny; or,
4. Refer to staff for reconsideration of specific items; or,
5. Continue to a future meeting (date and time to be specified in the motion).
CITY COUNCIL PRIORITIES
As provided for in the 2024-25 Adopted Budget.
DISCUSSION
State, local, and tribal governments have brought lawsuits against pharmacies, and pharmaceutical and drug distribution companies responsible for aiding the opioid epidemic. The lawsuits allege that these companies fueled the opioid crisis by marketing opioids in misleading ways, downplaying risks, exaggerating benefits, and engaging in reckless distribution practices. California has joined several of these national lawsuits to recover costs associated with the opioid epidemic. The money comes from pharmaceutical companies that made, distributed, or sold prescription opioid painkillers and that agreed to pay about $50 billion nationwide to settle lawsuits over their role in the overdose epidemic.
In late 2022 California received its first round of payments of a $50 billion national settlement. California will receive approximately $4 billion from the settlement to help address this crisis.
From the first disbursement of the settlement, the City of Merced received a total of $187,527.65 in Fiscal Year 2022-23 and 2023-24 to be used towards activities that prevent opioid misuse which include social media campaigns, training, and public education.
As of June 30, 2024, $12,756.98 was spent on opioid abatement and the funding received from the settlement earned $24,681.37 in interest leaving a balance of $199,452.04 to be spent on opioid abatement activities. This funding must be expended within 5 years of receipt or 7 years of receipt for capital outlay projects.
IMPACT ON CITY RESOURCES
In Fiscal Year 2023-24, the Police Department budget included Opioid Settlement funding and expenditures; however, the unspent balance of $199,452.04 from the settlement funding and its interest did not carry over to the Fiscal Year 2024-25 budget. An appropriation of $199,452.04 from the General Fund is requested to utilize this funding towards future Opioid Abatement activities for the program.
This budget appropriation will require an affirmative vote of five council members.
ATTACHMENTS
None.