55% Local Share
Where do these monies live?
This share is distributed to participating cities and counties according to the percentages listed in Exhibit C of New Mexico’s allocation agreement.[1] Each of these local governments were required to establish separate funds to specifically hold their opioid settlement proceeds separate from their general coffers or other local funds.[2]
New Mexico’s allocation agreement refers to these cities and counties as “regions,” which are single cities (e.g., Albuquerque), counties and their participating cities (e.g., Eddy County, inclusive of Artesia and Carlsbad), or counties without any participating cities (e.g., Mora County on its own).[3]
Regions containing more than one local government may agree to share funds amongst themselves in any manner they choose, with the default allocation from Exhibit G of the national settlements applying in the absence a specific agreement.[4]
What can this share be spent on?
With limited exceptions,[5] including substantial set-asides for attorneys’ fees,[6] this share must be spent on the opioid related expenditures uses described in the national settlement agreement’s (non-exhaustive) Exhibit E,[7] which includes prevention, harm reduction, treatment, recovery, and other strategies.
Additionally, local governments are prohibited from spending their shares to reimburse costs incurred prior to the applicable settlements being reached.[8]
Who ultimately decides how to spend this share (and how)?
Local governments decide autonomously. Decisionmakers for the counties and cities will ultimately decide for themselves how to spend their monies on Exhibit E uses,[9] whether independently or by combining their shares for joint uses.[10]
For example, the City of Albuquerque enacted a resolution outlining a process for the expenditure of settlement funds and is collaborating with Bernalillo County on strategic planning.[11]
Is this share attached to an explicit bar against supplantation?
No, supplantation is not prohibited. Like most states, New Mexico does not explicitly prohibit supplantation uses of its opioid settlement funds. This means that the 55% local share may be spent in ways that replace (or “supplant”) — rather than supplement — existing resources.
Can I see how this share has been spent?
Up to each locality (neither public nor intrastate reporting required). Opioid settlement expenditures are not officially published in a centralized location for this share.
Visit OpioidSettlementTracker.com’s Expenditure Report Tracker for an updated collection of states’ and localities’ available expenditure reports.
What else should I know?
Several of New Mexico’s opioid settlements were reached as the result of the Attorney General’s use of private law firms.[12] This approach incurred “significantly higher [attorneys’] fees” than states participating in national settlement accords and drew the attention of the state’s Legislative Finance Committee, among others.[13] In November 2023, the former Attorney General penned a response to these concerns.[14]
Citations
New Mexico Allocation Agreement (Agreement) B.3 (“55% to the Local Governments (the ‘LG Share’)”), B.4 (The LG Share will be divided into regions, each of which consists participating local governments), and B.5 (“The LG Share will be distributed to each Region as set forth in Exhibit C”). See also Agreement A.1 ( defining “Local Government” as “every litigating county and city, each county regardless of population, each city with a population exceeding 10,000 … identified on Exhibit A”) and A.6 (defining “Participating Local Government” to mean “any Local Government that agrees to be bound by a Settlement by Participation Agreement necessary to effectuate that Settlement or other similar document”). For a recent update on disbursements to local governments, see LFC Hearing Brief. New Mexico Legislative Finance Committee. May 16, 2024. Accessed August 11, 2024. ↑
Agreement C.1 (this is called an “LG Abatement Fund” and “[f]unds in an LG abatement fund shall not be commingled with any other money or funds of the Local Government”) (emphasis added). ↑
Agreement B.4 (“‘Region’ consists of either: (1) a single Participating County that does not have any Participating Cities, (2) a single Participating County and all of its Participating Cities or (3) a single Participating City. Two or more Regions may at their discretion form a group (“Multicounty Region”). Regions that do not choose to form a Multicounty Region will be their own Region”). ↑
Agreement D.3, D.5 (describing creation of the “New Mexico Backstop Fund” and that “after paying the LG Share of the costs of the Settlement Administrator, the Administrator shall deposit in the New Mexico Backstop Fund an amount equal to 15% of the LG Share and distribute the remainder of the funds allocated to Local Governments”). See also Agreement B.1 (describing settlement administrator costs as divided evenly between the state’s share and localities’ share). Note that these terms apply to the Distributors and Janssen settlements, as well as the settlements with Allergan, Teva, and “further national settlement agreements … joined by the State of New Mexico and Participating Local Governments after March 1, 2023”). Addendum to the New Mexico Opioid Allocation Agreement (Addendum). ↑
New Mexico hired private law firms to pursue its lawsuits against Walmart, Walgreens, CVS, Kroger, and Albertsons, incurring higher attorneys’ fees than the majority of states that opted to participate in national settlement agreements with these entities. As a result, of the total monies New Mexico recovered from the Distributors settlement and the settlements with Walmart, Walgreens, CVS, Kroger, and Albertsons, 28.2% will be paid to outside counsel. See LFC Hearing Brief. New Mexico Legislative Finance Committee. May 16, 2024. Accessed August 11, 2024. ↑
Agreement A.3 (defining "Opioid Related Expenditure” to mean “an expenditure consistent with the categories enumerated in Exhibit E to the Distributor Master Settlement Agreement and the J&J Master Settlement Agreement ... attached hereto as Exhibit B") and Agreement B.6 ("100% of the State Share and the LG Share, regardless of allocation, shall be utilized only for Opioid Related Expenditures”). See also Distributor Settlement Agreement 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”). ↑
Agreement C.2 (“For avoidance of doubt, funds in a LG Abatement Fund may not be expended for costs, disbursements, or payments made or incurred prior to the Settlement”). ↑
Agreement C.1-2 (describing participating local governments’ spending autonomy). ↑
Agreement C.4 (“Local Governments may combine their respective portion of the LG Share with other Local Governments or the State”). ↑
Establishing a Policy for the Expenditure of Opioid Settlement Monies. Albuquerque City Council. R-23-174; City Council Approves Collaboration with Bernalillo County on Comprehensive Spending Policy for Opioid Settlement Funds. Albuquerque City Council News. October 16, 2023. Accessed August 11, 2024. ↑
See OpioidSettlementTracker.com’s Global Settlement Tracker. New Mexico hired private law firms to pursue its lawsuits against Walmart, Walgreens, CVS, Kroger, and Albertsons, incurring higher attorneys’ fees than the majority of states that opted to participate in national settlement agreements with these entities. As a result, of the total monies New Mexico recovered from the Distributors settlement and the settlements with Walmart, Walgreens, CVS, Kroger, and Albertsons, 28.2% will be paid to outside counsel. See LFC Hearing Brief. New Mexico Legislative Finance Committee. May 16, 2024. Accessed August 11, 2024. ↑
See LFC Hearing Brief. New Mexico Legislative Finance Committee. May 16, 2024. Accessed August 11, 2024. See, e.g., Curtis Segarra. New Mexico to use over one fourth of opioid settlement fees on outside lawyers, according to LFC. KRQE News. May 17, 2024. Accessed August 11, 2024. ↑
Hector Balderas and Brian McMath. New Mexico Deserves the Facts, Communities Will Receive Vital Treatment Dollars from Opioid Litigation. Rio Grande Sun. November 22, 2023. Accessed August 11, 2024. ↑
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