Ohio governments working to craft unusual opioid bargain
Columbus, Ohio – Ohio’s governor, attorney general and dozens of local governments are nearing agreement on divvying up proceeds of a potentially huge settlement with the opioid industry, hoping to avoid mistakes made with the national tobacco settlement.
The so-called “One Ohio” agreement, still not final, would give local governments much of the control of the purse strings – all but cutting out state lawmakers remembered fordiverting tobacco settlement money at one point that had been intended to cover smoking-related health care costs to pay for other things.
No other state has announced plans for dividing settlements over the toll of opioids. And so far no national opioid settlement has been finalized. One with OxyContin maker Purdue Pharma is being worked on in bankruptcy court, and a group of three drug distribution companies and two manufacturers are working on a settlement intending to resolve all litigation against them.
Communities in Ohio would receive 30% of the money up front – double the 15% reserved for the state, and hold some long-term sway over a network of regional boards reporting to a nonprofit foundation that would manage the remaining 55%. The number of opioid deaths suffered by a community would be among criteria for determining its share.
“People agreed the Legislature really shouldn’t have access to this,” said Kent Scarrett, executive director of the Ohio Municipal League.
Still, attorneys are working to address significant divisions that remain after a meeting of the parties last week. Large cities and counties, mostly controlled by Democrats, sat side-by-side at the gathering with largely GOP-led smaller cities and counties, and Gov. Mike DeWine and Attorney General Dave Yost, also Republicans.
Everyone recognizes the value of presenting a unified front to a federal judge in Cleveland handling thousands of opioid-related cases, said those privy to the discussions.
Opioids, including both powerful prescription painkillers and illegal drugs such as heroin and illicit fentanyl, have been linked to more than 430,000 deaths in the U.S. since 2000. The drug industry is facing about 3,000 lawsuits over the toll of the drugs, including from 49 states and thousands of municipal, county and Native American tribal governments.
The sprawling litigation is among the most complex ever in the U.S., and if Ohio could hammer out a unified plan for spending any settlement dollars, if would save both time and money.
The 1998 master settlement agreement between Ohio and more than 40 other states and territories and Big Tobacco companies is a cautionary tale. Intended to cover states’ health care costs related to smoking, Ohio’s share, estimated at $10 billion a year for the first 26 years, was diverted over time to cover K-12 and higher education construction projects – and eventually cashed in to pay for a tax exemption and other programs.
But tensions between Ohio’s smaller and larger communities – as well as between all the municipalities and the state – prompted requests that the ultimate Ohio deal provide more legal assurances to cities and counties about the 55% share proposed to go to the foundation.
Cincinnati Mayor John Cranley, a Democrat planning a run for governor, said DeWine’s outline for the foundation’s structure is dubious.
“It was very unclear how it would be governed, very unclear how it would distribute funds and no guarantee it would get back to local governments,” Cranley said.
The draft plan, obtained from Yost’s office, calls for the foundation to be overseen by a 25-member board of state and regional appointees, including four lawmakers, 10 “non-metropolitan” representatives and five from metropolitan areas.
The document calls for the foundation to hire an executive director and an “expert panel” and to spend no less than 10% of its annual payout “to support evidence-based substance abuse/misuse prevention efforts.”
Cranley called that “insulting,” saying cities and counties are the experts.
“This isn’t about creating some huge bureaucracy in Columbus to study the issue when we have real people dying on the streets, real people needing recovery beds, needle exchanges, harm reduction, Suboxone, Narcan,” he said, referring to an addiction treatment drug and overdose antidote. “This isn’t make-believe stuff. This is real local needs that have not been paid for in the past and are going to be necessary for many years to come.”