SUBJECT: Consent Agenda
Title
A Resolution of the Board of Trustees of the Town of Erie Approving the Colorado Opioids Settlement Memorandum of Understanding and the Associated Colorado Subdivision Escrow Agreement and Subdivision Participation Forms
Body
DEPARTMENT: Administration
PRESENTERS: Malcolm Fleming, Town Administrator
Kendra Carberry, Town Attorney
STAFF RECOMMENDATION:
Recommendation
Approve Resolution to approve the Colorado Opioids Settlement Memorandum of Understanding and the Association Subdivision Agreement and Subdivision Participation Forms
End
SUMMARY AND BACKGROUND OF SUBJECT MATTER:
The Colorado Opioids Settlement Memorandum of Understanding (MOU) establishes the framework for distribution and sharing any settlement funds that will be available to Colorado from the nationwide settlement with the “Big 3” opioid distributors (McKesson, Cardinal Health and AmerisourceBergen) and opioid manufacturer Johnson & Johnson. Various Colorado local government officials worked with the Attorney General’s Office to negotiate establish this framework.
Colorado will only receive its maximum share from the settlements (estimated to be more that $300 million) if enough local government entities sign on to the MOU. To maximize Colorado’s recovery the Colorado Attorney General is asking local governments to sign the following four documents:
1. The MOU that lays out the allocation of Opioid recoveries in the State of Colorado;
2. The Subdivision Settlement Participation Form that releases subdivisions’ legal claims against Johnson & Johnson;
3. The Subdivision Settlement Participation Form that releases subdivisions’ legal claims against AmerisourceBergen, Cardinal Health, and McKesson; and
4. The Colorado Subdivision Escrow Agreement that ensures subdivisions’ legal claims are released only when 95% participation by certain local governments has been reached. That 95% participation threshold is important because it triggers certain amounts of incentive payments under the settlements and signals to the settling pharmaceutical companies that the settlements have wide acceptance.
Participation is not limited to litigating entities. However, if the Town wants access to any of the settlement funds the Board must approve this MOU and related forms.
Fiscal Impact:
By signing the MOU the Town will be able to access any funds from the settlement to which it is entitled. Should the Town elect not to sign this MOU then the Town will be unable to receive the Town’s direct share of settlement funds.
The Town of Erie’s direct allocations are 0.3634% of the Intracounty share for Boulder County and 0.8591% of the Intracounty share for Weld County. In total these percentages appear relatively small compared to other cities and towns with population similar to Erie. Consequently, staff have asked the State for an explanation of why that might be.
All settlement funds must be used only for “Approved Purposes,” a long and broad list that focuses on abatement strategies. These strategies emphasize prevention, treatment, and harm reduction. Some examples of these strategies include training health care providers on opioid use disorder (“OUD”) treatment and responsible prescribing, expanding telehealth and mobile services for treatment, and increasing naloxone and rescue breathing supplies. The list of Approved Purposes is broad enough to be flexible for local communities, while ensuring that settlement funds are used to combat the opioid epidemic. The list of Approved Purposes is attached as Exhibit A to the MOU.
Board Priority(s) Addressed:
ü Safe and Healthy Community
ü Effective Governance
ü Fiscally Responsible
ATTACHMENTS:
1. Resolution 21-142
2. Letter from AG
3. Colorado Opioid MOU
4. Local Government Escrow Agreement
5. Distributor Opioid Settlement Participation Form
6. Johnson & Johnson Opioid Settlement Form
7. Colorado Opioid MOU FAQ
8. Colorado Opioid MOU Summary