Can I provide input on spending?

• 85% local share: Generally, yes. Though local governments are not required to seek public input as to opioid settlement spending specifically,[1] local governments generally must accept public comments during their public meetings.[2] Take advantage of this requirement by showing up to meetings of your city council or board of county commissioners and offering comments on local settlement spending, and watch for other opportunities to weigh in on city and county spending decisions (e.g., Santa Cruz County’s 2023 town halls).

  • The California Department of Health Care Services (DHCS) “strongly encourages” but does not require subdivisions “to coordinate with external entities, such as local departments of health, service and community groups, and people with lived experience, to determine the best use of their allocations.”[3]

• 15% state share: No opportunities available (not required). The state has not established recurring opportunities for the public to provide input on uses of its 15% share.[4] In December 2022, the California Department of Health Care Services (DHCS) hosted a listening session to solicit feedback from its local governments on the reporting process for the Janssen and Distributors settlement agreements. California’s various State-Subdivision Agreements also provide that each year in which the DHCS prepares an annual report on the use of the state’s funds, it must “host a meeting to discuss the annual report and the Opioid Remediation activities being carried out by the State and Participating Subdivisions.”[5] As of September 1, 2024, the state has yet to mention either the annual meeting or report on its website.

Can I apply for grants?

Yes. California has previously established opportunities in which community organizations are eligible to apply for state settlement funds. Local governments also may create grant programs to distribute their share of funds. The existence, parameters, and processes for local settlement grant programs will vary by locality, so stay alert for new opportunities. Visit the Opioid Settlement Community Grants Portals (OpioidSettlementTracker.com and Legal Action Center) for the most up-to-date information on settlement grant opportunities for community organizations.

Where do I go for updates?

• For updates on the local share, visit the Department of Health Care Services’ California's Opioid Settlements website, including its City and County Projects page, and subscribe to DHCS’s regular newsletter here. Another good starting point is to check the website for your county board of supervisors, city council, or local health department.

• For updates on the state share, visit the Department of Health Care Services’ California's Opioid Settlements website, including its State Funded Projects page, and sign up for updates on DHCS’s opioid response efforts here.

What else should I know?

Not applicable.

Citations

1. See, e.g., California Opioid Settlements Frequently Asked Questions (FAQs). California Department of Health Care Services. June 2024 (“Are Participating Subdivisions required to gather public input on expenditure plans prior to using the funds?” “Participating Subdivisions are not required to gather public input when developing expenditure plans for funds received from the opioid settlements. However, to increase the efficacy and success of opioid remediation efforts, DHCS strongly encourages Participating Subdivisions to coordinate with external entities, such as local departments of health, service and community groups, and people with lived experience, to determine the best use of their allocations. DHCS hosted a webinar on this topic, available on the California Opioid Settlements webpage”). ↑

2. Cal. Gov’t. Code Sec. 54954.3(a). ↑

3. California Opioid Settlements Frequently Asked Questions (FAQs). California Department of Health Care Services. June 2024 (“participating subdivisions” means cities and counties). ↑

4. If you see this change, email tips@opioidsettlementtracker.com. There is no legal requirement for decision-makers to seek public input on uses of this share. ↑

5. You can find California’s State-Subdivision Agreements regarding settlements with various defendants here (including the Distributors, Johnson & Johnson, Teva, Allergan, Walgreens, Walmart, and CVS). In each, the requirement for DHCS to host these meetings may be found in section 5(e). ↑

Here are the entities that ultimately decide how each of California’s opioid settlement shares are spent:

• 85% local share: local officials for cities and counties

• 15% state share: California state legislature

Where do these monies live?

California’s combined 85% local share is distributed to its cities and counties from two sources:[1]

• Seventy percent (70%) derives from the Abatement Accounts Fund share and is distributed to all participating local governments.[2]

• Fifteen percent (15%) derives from the California Subdivision Fund share and is distributed to certain local governments that filed litigation against opioid-related companies prior to October 1, 2020.[3]

Note: This allocation applies to all of California’s opioid settlements except the Mallinckrodt bankruptcy, which allocates 60% of funds to local governments and 40% to the state.[4]

What can this share be spent on?

In general, and with limited exceptions,[5] California’s local shares must be spent on the uses described in the national settlement agreements’ (non-exhaustive) Exhibit E,[6] which includes prevention, harm reduction, treatment, recovery, and other strategies.

• Monies from the 70% Abatement Accounts Fund must be spent on forward-looking Exhibit E uses only,[7] with at least half spent on the California High Impact Abatement Activities (HIAA) list.[8] Indirect costs are capped at 10%,[9] and several law enforcement uses of this share are prohibited outright.[10] Localities must spend or encumber funds from this share within five years of receiving them, or seven years for capital outlay projects, or the funds are returned to the state.[11]

• Monies from the 15% California Subdivision Fund are not subject to the same restrictions. After certain fees and costs,[12] the remaining funds — “no less than 50% of the total CA Subdivision Fund received in any year” — may be spent on future opioid-related projects, to reimburse past opioid-related expenses, and attorneys’ fees.[13]

Who ultimately decides how to spend this share (and how)?

Localities decide autonomously (with California Department of Health Care Services oversight). Though decisionmakers for California’s cities and counties will ultimately decide for themselves how to spend their monies,[14] they must report their expenditures to the California Department of Health Care Services,[15] which must monitor their compliance with the agreements.[16] Additionally, settlement funds allocated to a city from the Abatement Accounts Fund are paid to the county in which the city is located unless the city specifically requests direct payment(s).[17]

Are supplantation uses prohibited for this share?

No, supplantation is not prohibited. Like most states, California does not explicitly prohibit supplantation uses of its opioid settlement funds. This means that local governments may spend funds from their share in ways that replace (or “supplant”) — rather than supplement — existing resources.

Can I see how this share has been spent?

Eventually (public reporting required). Local expenditures will be published on the California Department of Health Care Services’ Opioid Settlements website each year.[18] Localities are required to report settlement expenditures to DHCS, and DHCS is then required to post an annual written report regarding the use of settlement funds on its website.[19]

Visit OpioidSettlementTracker.com’s Expenditure Report Tracker for an updated collection of states’ and localities’ available expenditure reports.

What else should I know?

Not applicable.

Citations

1. See Proposed California State-Subdivision Agreement Regarding Distribution and Use of Settlement Funds – Distributor Settlement (“CA Distributor State-Subdivision Agreement”), Secs. 2(a) (defining “CA Participating Subdivision” as “a Participating Subdivision that is also (a) Plaintiff Subdivision and/or (b) a Primary Subdivision with a population equal to or greater than 10,000” but excluding “Litigating Special Districts”), 2(d) (defining “Plaintiff Subdivision” as “a Subdivision located in California, other than a Litigating Special District, that filed a lawsuit, on behalf of the Subdivision and/or through an official of the Subdivision on behalf of the People of the State of California, against one or more Opioid Defendants prior to October 1, 2020”), 2(c) (defining “Litigating Special District” as “a school district, fire protection district, health authority, health plan, or other special district that has filed a lawsuit against an Opioid Defendant”), 4.B(i)(a) (allocating 70% share to “CA Participating Subdivision[s]”), 4.C(i) (allocating 15% share to “Plaintiff Subdivisions that are Initial Participating Subdivisions”). See also California State-Subdivision Agreements Regarding Distribution and Use of Settlement Funds for the Allergan Settlement, CVS Settlement, Janssen Settlement, Kroger Settlement, Teva Settlement, Walgreens Settlement, and Walmart Settlement (substantively identical provisions). All other footnotes will cite to only the CA Distributor State-Subdivision Agreement. ↑

2. CA Distributor State-Subdivision Agreement, Sec. 4.B(i)(a). ↑

3. CA Distributor State-Subdivision Agreement, Sec. 4.C(i).. ↑

4. California Mallinckrodt Statewide Abatement Agreement In re: MALLINCKRODT PLC, et al. Bankruptcy Case No. 20-12522, Sec. 4 (allocating 40% to the state and 60% to local governments). See also Payment Information (“Mallinckrodt Bankruptcy Distribution”). California Department of Health Care Services website. Accessed August 28, 2024; OpioidSettlementTracker.com’s Global Settlement Tracker. ↑

5. Administrative, reimbursement, and attorneys’ fee uses depend on the share (see later footnotes). See also Distributor Settlement Agreement, Sec. I.SS (“Exhibit E provides a non-exhaustive list of expenditures that qualify as being paid for Opioid Remediation. Qualifying expenditures may include reasonable related administrative expenses”). ↑

6. CA Distributor State-Subdivision Agreement, Secs. 4.B(ii)(a), 4.C(i); Distributor Settlement Agreement, Sec. I.SS (“Exhibit E provides a non-exhaustive list of expenditures that qualify as being paid for Opioid Remediation. Qualifying expenditures may include reasonable related administrative expenses”). ↑

7. CA Distributor State-Subdivision Agreement, Sec. 4.B(ii)(a). This means that reimbursement uses of opioid settlement funds are specifically prohibited for this share. ↑

8. CA Distributor State-Subdivision Agreement, Sec. 4.B(ii)(b). See also Allowable Expenditures (“California High Impact Abatement Activities (HIAA)”). California Department of Health Care Services website. Accessed August 28, 2024 (“Detailed definitions of the HIAA can be found in the DHCS BHIN 24-002 California Participating Subdivision Use of Opioid Settlement Funds Allocated from the California Abatement Accounts Fund”). See also CA Distributor State-Subdivision Agreement, Sec. 4.B(ii)(c) (“The California Department of Health Care Services (‘DHCS’) may add to this list (but not delete from it) by designating additional High Impact Abatement Activities. DHCS will make reasonable efforts to consult with stakeholders, including the CA Participating Subdivisions, before adding additional High Impact Abatement Activities to this list”). ↑

9. Enclosure 1: Reasonable Administrative Costs Policy. California Department of Health Care Services. Accessed August 28, 2024 (“Indirect costs are not considered to meet the intent of the HIAA”). See also Behavioral Health Information Notice No: 24-002. California Department of Health Care Services. January 4, 2024 (“Funds received from the CA Abatement Accounts Fund may be used to cover indirect and administrative expenses pursuant to DHCS’ Reasonable Administrative Costs Policy (Enclosure I)”). ↑

10. Law Enforcement Expenses with Opioid Settlement Funds Fact Sheet​. California Department of Health Care Services. April 2024. Accessed August 28, 2024. See also Behavioral Health Information Notice No: 24-002. California Department of Health Care Services. January 4, 2024 (“Examples of unallowable expenditures include, but are not limited to: … Paying for law enforcement activities or equipment (e.g., vehicles, apprehension or restraint devices, drug checking devices, etc.) related to interdiction or criminal investigation, apprehension, and processing”). ↑

11. CA Distributor State-Subdivision Agreement, Sec. 4.B(i)(f); Cal. Gov't Code Sec. 12534(i). ↑

12. CA Distributor State-Subdivision Agreement, Secs. 4.C(i)(a) (payment of “Special Master’s reasonable fees and expenses”), 4.C(i)(b) (funds to “Plaintiff Subdivisions that are Initial Participating Subdivisions that have been awarded Costs”). ↑

13. CA Distributor State-Subdivision Agreement, Sec. 4.C(i)(c). See also Allowable Expenditures (“California Subdivision Fund”). California Department of Health Care Services website. Accessed August 28, 2024 (“allocations from the CA Subdivision Fund shall be used to fund future opioid remediation projects and reimburse past opioid-related expenses, which may include fees and expenses related to litigation against a relevant Opioid Defendant”). ↑

14. See CA Distributor State-Subdivision Agreement, Sec. 5(c) (“Unless otherwise exempt, Subdivisions’ expenditures and uses of CA Abatement Accounts Funds and other Settlement Funds will be subject to the normal budgetary and expenditure process of the Subdivision”). ↑

15. CA Distributor State-Subdivision Agreement, Secs. 5(b)-(d). See also QUESTION & ANSWER California Opioid Settlement Expenditure Report, California Department of Health Care Services. June 2024. Accessed August 29, 2024. ↑

16. Cal. Gov't Code Sec. 12534(h) (“The State Department of Health Care Services shall administer the Opioid Settlements Fund and shall oversee those activities funded by the Opioid Settlements Fund. This shall include, but not be limited to, designating additional high-impact abatement activities, conducting related stakeholder engagement, monitoring the California participating subdivisions for compliance, and preparing periodic written reports”). See also California Opioid Settlements Frequently Asked Questions (FAQs). California Department of Health Care Services. June 2024. Accessed August 29, 2024 (“What happens if Participating Subdivisions expend funds on unallowable activities? If DHCS determines that a CA Participating Subdivision’s use of California Abatement Accounts Funds is inconsistent with eligible uses, records may be requested as part of a meet and confer, an audit, or legal action”). ↑

17. CA Distributor State-Subdivision Agreement, Secs. 4.B.i(c) (“The Local Allocation share for a city that is a CA Participating Subdivision will be paid to the county in which the city is located, rather than to the city, so long as: (a) the county is a CA Participating Subdivision, and (b) the city has not advised the Settlement Fund Administrator that it requests direct payment at least 60 days prior to a Payment Date. A Local Allocation share allocated to a city but paid to a county is not required to be spent exclusively for abatement activities in that city, but will become part of the county’s share of the CA Abatement Accounts Funds”), 4.B.i(d) (“A city within a county that is a CA Participating Subdivision may opt in or out of direct payment at any time, and it may also elect direct payment of only a portion of its share … the Cities of Los Angeles, Oakland, San Diego, San Jose and Eureka will be deemed to have elected direct payment if they become Participating Subdivisions”). ↑

18. See also Aneri Pattani and don Thompson. In California, opioid settlement money helps fund lifesaving drugs and police projects. Los Angeles Times. July 11, 2024. Accessed August 29, 2024. ↑

19. CA Distributor State-Subdivision Agreement, Sec. 5(a)-(d). ↑

Has the state established an advisory body for settlement funds?

No. California has not established an advisory body to inform opioid settlement spending.

Is the state advisory body required to include member(s) with lived and/or living experience?

Not applicable.

What is the overall membership of the state advisory body?

Not applicable.

Are local governments required to establish a settlement advisory body? If so, are local advisory bodies required to include member(s) with lived and/or living experience?

No (up to each locality). Local governments in California are not required to establish opioid settlement advisory bodies to inform spending of the 85% local share. However, localities may choose to establish advisory councils that include members with lived and/or living experience to help ensure that settlement spending reflects community priorities.

What else should I know?

Not applicable.

Citations

California Department of Health Care Services (DHCS)

• California's Opioid Settlements

• State Funded Projects, Current Projects

• City and County Projects

• Resources

  • California Opioid Settlements FAQs

  • Allowable Expenditures

California Department of Public Health

• Syringe Services Programs & Harm Reduction

• Directory of Syringe Services Programs in California

This Community Guide will describe how California is spending its opioid settlements and whether California is working to ensure community access to opioid settlement funds. Last revised September 1, 2024.

Where do these monies live?

The Opioid Settlement Fund holds the state government’s 15% share.[1]

Note: This allocation applies to all of California’s opioid settlements except the Mallinckrodt bankruptcy, which allocates 60% of funds to local governments and 40% to the state.[2]

What can this share be spent on?

With limited exceptions,[3] California’s state share must be spent on the uses described in the national settlement agreements’ (non-exhaustive) ,[4] which includes prevention, harm reduction, treatment, recovery, and other strategies. Monies from this 15% California State Fund share must be spent on forward-looking Exhibit E uses only.[5]

Who ultimately decides how to spend this share (and how)?

State legislature decides, California Department of Health Care Services oversees and administers. The ultimately “determine[s] and appropriate[s]” the state’s 15% share,[6] and the (DHCS) “administer[s]” and “oversee[s]” its activities.[7]

Are supplantation uses prohibited for this share?

No, supplantation is not prohibited. Like most states, California does not explicitly prohibit supplantation uses of its opioid settlement funds. This means that the 15% state share may be spent in ways that replace (or “supplant”) — rather than supplement — existing resources.

Can I see how this share has been spent?

Eventually (public reporting required). You can view expenditures from the state share on the California Department of Health Care Services’ webpage, as well as on the DHCS Opioid Responses’ and the webpages. The California Department of Health Care Services is required to prepare an annual report regarding settlement expenditures and make the report publicly available on its website.[8]

Visit OpioidSettlementTracker.com’s for an updated collection of states’ and localities’ available expenditure reports.

What else should I know?

Not applicable.

Citations

7. Cal. Gov't Code Secs. 12534(g) (“Upon appropriation by the Legislature, moneys in the Opioid Settlements Fund shall be used for opioid remediation in accordance with the terms of the judgment or settlement from which the funds were received”), (h) (“The State Department of Health Care Services shall administer the Opioid Settlements Fund and shall oversee those activities funded by the Opioid Settlements Fund”). ↑