70% County Abatement Account Share
Where do these monies live?
Seventy percent (70%) of Pennsylvania’s opioid settlement funds are deposited into the Pennsylvania Opioid Misuse and Addiction Abatement Trust’s (PA Abatement Trust) County Abatement Account,[1] then distributed directly to counties ("or such other organization designated by the County”) according to Exhibit 1 of Pennsylvania’s court order.[2]
What can this share be spent on?
With limited exceptions,[3] counties must spend their shares on the uses described in the national settlement agreement’s (non-exhaustive) Exhibit E,[4] which includes prevention, harm reduction, treatment, recovery, and other strategies.
Any beneficiary of the Trust may also petition the court overseeing the Trust to “allow spending on an item of abatement not contained in Exhibit E, provided such spending is deemed by the Court to reduce incidence or rate of opioid addiction and overdose deaths in the Commonwealth.”[5]
The PA Abatement Trust has also indicated in an FAQ that “any type of policing activity would not be considered allowable spending.”[6]
Who ultimately decides how to spend this share (and how)?
Counties decide autonomously (but must certify proper uses). Decisionmakers for the counties (or their designated organizations) will ultimately decide for themselves how to spend their monies on Exhibit E uses,[7] whether directly or as grants to organizations.[8] However, each must annually certify that their shares will be spent on abatement in order to receive their funds.[9] County recipients of funds are also required to report expenditures to the PA Abatement Trust and encouraged to spend their funds “equitably across the County.”[10]
Local governments’ certifications and reports of spend are reviewed by the PA Abatement Trust’s Board of Trustees,[11] which governs the trust.[12] The Board may reduce or withhold payments from local governments that use settlement funds for non-approved purposes or fail to comply with annual reporting requirements.[13] The Board provides technical assistance to Trust recipients but is “not specifically authorized to provide advance input to recipients of distributions of Trust funds.”[14]
Monies from the county abatement account share must be spent within 18 months of receipt unless dedicated to a multi-year capital project.[15]
Is this share attached to an explicit bar against supplantation?
No, supplantation is not prohibited. Like most states, Pennsylvania does not explicitly prohibit supplantation uses of its opioid settlement funds. This means that the County Abatement Account share may be spent in ways that replace (or “supplant”) — rather than supplement — existing resources. However, the Pennsylvania Opioid Misuse and Addiction Abatement Trust has published guidance describing counties’ uses of settlement funds to pay for services that a county is already required to provide as impermissible uses of their shares.[16]
Can I see how this share has been spent?
Eventually (public reporting required). Counties must report expenditures to the PA Abatement Trust,[17] and the Trust must publish an “annual report and accounting.”[18] Bookmark the Trust’s Payment, Spending & Reporting page and view its interim reporting.
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
Pennsylvania Opioid Misuse and Addiction Abatement Trust Court Order (Allocation Order) Para. II.A(1)(b) (“The County Abatement Account shall consist of Seventy (70) % of the Trust Funds to be distributed and shall be paid to Counties and other County Subdivisions in the manner described in the Allocation Section at VII(A) below”). ↑
Allocation Order Para. VII.A (“The funds designated for the County Abatement Account shall be distributed directly to the Counties or such other organization designated by the County. Each County shall receive its share consistent with the methodology outlined in Exhibit 1, with each county receiving a minimum of $1 million total combined from the Settlements. To the extent the Commonwealth receives less than the full amounts available under the Settlements, the Trustees shall reduce each County’s share (identified in Exhibit 1) pro rata”). ↑
Allocation Order Para. II.A(1) (“After the payment by the Trust of Attorneys’ Fees and Expenses as described in Section IX, Exhibit 4 … , the Trust Funds shall be divided into three accounts: The Commonwealth Account, the County Abatement Account and the Litigating Subdivision Account”), Para. V.D(9) (“The Board of Trustees may use up to 1% of the Trust funds to retain such persons or firms to manage the investment, and distributions”), and Exhibit 4 Para. I.A (“The amount of the Pennsylvania Opioid Fee Fund shall not exceed 6.6% of all base and incentive payments governmental entities will receive”). See also Report to the Commonwealth Court of Pennsylvania filed November 7, 2023. Pennsylvania Opioid Misuse and Addiction Abatement Trust (PA Abatement Trust). Accessed August 24, 2024. (“Distributions for attorneys’ fees and expenses under Paragraph IX and Exhibit 4 of the Trust Order totaled $28,167,022”; “The Board plans to use income generated by the Trust Funds to pay for administrative services needed for Trust operations. No fees were paid to Wilmington Trust during the Reporting Period”) and 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”). ↑
Allocation Order Para. V.B (“The funds obtained and ultimately paid by the Trust shall be distributed to the Commonwealth and its Participating Subdivisions only for the purposes set forth in Exhibit E to the Settlements and the Trust shall review expenditures by subdivisions which receive Trust Funds to insure that such spending was consistent with Exhibit E. Exhibit E is incorporated into this Order by reference and all spending of funds allocated by this Order shall be consistent with the requirements of Exhibit E”) and Para. III.K (defining “Participating Subdivisions” to include counties, DAs, and county subdivisions of “more than 10,000 in population”). See also Report to the Commonwealth Court of Pennsylvania filed November 7, 2023. PA Abatement Trust. Accessed August 24, 2024 (“Paragraph V(B) restricts the purposes for which funds distributed by the Trust to Distributees may be used. This paragraph limits use of distributed funds ‘only for the purposes set forth in Exhibit E to the Settlements.’ Exhibit E is one of the lettered exhibits attached to both the J&J Respondents’ and Distributor Respondents’ Settlement Agreements”). ↑
Frequently Asked Questions. PA Abatement Trust. Accessed August 24, 2024 (see, e.g., response to the question, “Can a small portion of settlement funds be used to support a county Drug Task Force?”). ↑
See, e.g., Nicole Leonard. Philadelphia awards bulk of $3 million in opioid settlement grants to nonprofits working in North Philly and Kensington. WHYY. June 13, 2024. Accessed August 24, 2024. ↑
Allocation Order Para. V.D(3) (providing that “by November 15 of each year, in order for funds to be paid from the County Abatement Account, each County or the Health Department of a city of the First Class shall submit to the Trust the certification attached as Exhibit 2 and list the payees and respective addresses to which the County Abatement Check shall be sent. Multiple Counties and the Health Department of the city of the First Class, County Subdivisions and District Attorneys may file joint certifications for some or all of the funds allocated to them”) and Allocation Order Exhibit 2 (requiring certification that county abatement funds “will be used in a manner consistent with the Abatement uses described in Exhibit E”). ↑
Allocation Order Para. V.D(11) (Each County or the Health Department of the city of the First Class shall submit a report to the Board of Trustees by March 15 beginning in the year 2023 year, showing the actual expenditures of such funds and the amount of funds received but not spent by the close of the previous calendar year. Funds should be spent equitably across the County in a way that most effectively abates the effects of the Opioid misuse and addiction within the judgment of the County Commissioners, County Executive and County Council. The Board of Trustees shall set the requirements of such reporting, with input from qualified academic researchers”). ↑
Allocation Order Para. VI.A(2)-(3) (“The Trust shall have the following responsibilities … “[r]eviewing certifications in accordance with the terms specified by this document” and “[r]eviewing annual reports on spending to ensure compliance with the settlement terms”). ↑
Allocation Order Para. V.C (“The Trust shall be governed by a Board of Trustees”). ↑
Allocation Order Para. X.C(1) (requiring the PA Abatement Trust Board of Trustees to withhold counties’ or litigating subdivisions’ payments for the next year if they fail to properly spend their shares or fail to submit their annual reports). A local government has up to 3 months to “cure” any misspending or the failure to submit a report of spending. ↑
Requests for Technical Assistance and Trust Inquiries. PA Abatement Trust. Accessed August 25, 2024. ↑
Allocation Order Para. V.D(10) (“All funds must be spent within 18 months of receipt by the recipient unless a Subdivision elects to use such funds for a multi-year capital project in accordance with Exhibit E of Settlements”). The use of “subdivision” here is unspecific to “litigating subdivisions” and is interpreted by this Guide as a general reference to local government beneficiaries of the Trust. ↑
See, e.g., Frequently Asked Questions. PA Opioid Misuse and Addiction Abatement Trust. Accessed September 1, 2024 (see “Can settlement funds be used to partially fund an assistant public defender? Since the services of an assistant public defender are required to be provided by the counties, the costs associated with their position would not be considered an abatement strategy.”) ↑
Allocation Order Para. V.D(11) (Each County or the Health Department of the city of the First Class shall submit a report to the Board of Trustees by March 15 beginning in the year 2023 year, showing the actual expenditures of such funds and the amount of funds received but not spent by the close of the previous calendar year. Funds should be spent equitably across the County in a way that most effectively abates the effects of the Opioid misuse and addiction within the judgment of the County Commissioners, County Executive and County Council. The Board of Trustees shall set the requirements of such reporting, with input from qualified academic researchers”). ↑
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