LOCAL PROBLEMS REQUIRE LOCAL SOLUTIONS, AND THE OPIOID ABATEMENT FUND SEEKS TO DO JUST THAT

by Wesley Doyle, UT CTAS Communications Specialist; David Connor, TCSA Executive Director; and Jeremy C. Kourvelas, UT SMART Program Coordinator

Many Tennesseans have been impacted by the opioid crisis either directly or indirectly. As a state, Tennessee ranks third highest when it comes to prescription drug abuse. Local news daily headlines report unfortunate deaths, overdoses and accidents of all kinds across the “Volunteer State,” attributed to opioid addiction. While local governments have been struggling with the effects of the crisis for years, a turning point occurred in 2021, when the Tennessee Opioid Abatement Fund was established to administer funds from several nationwide settlement agreements.

Allegations and charges were brought against a number of large pharmaceutical companies, pharmacy chains and other medical manufacturers by a large group

of U.S. states, commonwealths and local political subdivisions. Several local governments

in Tennessee, including a number of counties, were involved in the litigation.

Then-Tennessee Attorney General Herbert Slatery also took a lead role in investigating

the companies and negotiating these settlements to begin repairing the damages that

ravaged communities across the country.

The allegations and claims in the lawsuits were long, but they essentially boiled

down to this: Significant and unfathomable harm was caused due to neglect on

the companies’ part in how they marketed these pharmaceuticals, often claiming

they were non-addictive. As part of the settlements, state governments established

ongoing trust funds. While county governments receive some funds directly from the

national settlement agreements, the bulk of the money is placed in a trust and overseen

by a council, created for that sole purpose. In Tennessee, 15 percent of the funds

come directly to local governments from the national administrator of the settlement

fund. An additional 15 percent goes directly to the state. The remaining 70 percent of

the funds are placed in this trust.

The Creation of the Opioid Abatement Council and Its Impact on County Abatement Programs/Strategies

Tennessee’s Opioid Abatement Council (OAC) was founded in 2022 by the General

Assembly through legislation. It was created to administer the bulk of the funds awarded

to the state through these historic national lawsuits. With a Board of 15 representatives

from across the state, the Council is charged with “… the disbursement of funds held

in the opioid abatement fund by decisions approved by at least a majority of the entire

membership of the council (Tenn. Code Ann. § 33-11-105)”

The Tennessee County Services Association (TCSA) appoints two members to

the Council, which ensures that counties are well-represented as the funds

are allocated. It’s important to note that out of all of the funds the Opioid Abatement Fund receives, the council distributes 35 percent of the funds directly to county governments.

Over the full payment period of the settlement agreements, this should amount to

approximately $118 million, according to the TN AG’s office. These funds provide county governments a new stream of dedicated revenue to address the problem, and

it’s proven to be an opportunity that many counties have taken advantage of.

You can see a few examples of these innovative programs implemented at the local

level later in this edition of Tennessee Counties magazine, but for now, let’s look

at some of the funding decisions and mechanisms of the Council.

How Are County Payments from the Opioid Abatement Trust Fund Allocated?

When initially calculating the distribution to Tennessee’s counties, the Council relied on data updated by the Tennessee Department of Health. The factors considered are:

• County-level data for fatal and non-fatal overdoses;

• The volume of opioid prescriptions in the county; and

• County population.

These statistics will be reviewed and updated throughout the duration of the

settlement agreement. If you’re wondering how often this updated data is provided

to the Council, Figure 2 shares these planned updates. Because the statistics are

reviewed and updated over time, payment projections cannot be made for the entire

lifecycle of the settlement agreements.

Abatement Funds Spent So Far

In 2022, the Council released its strategic plan to combat and remediate the opioid crises facing Tennessee. Many strategies mimic those efforts across other U.S. states and political subdivisions. These strategies and programs include things such as harm reduction, connection to care, addressing the needs of criminal justice-affected individuals

and medication-assisted treatment education for health care providers. They are based on approved remediation strategies that were identified as a part of the national settlement agreements.

In determining how to invest their funds, counties should look to these approved strategies as a guide for how to mitigate the effect of the opioid crisis on their community. According to the Council’s report, counties have received approximately $31 million per year in direct payments for the last two years. While the exact amount will fluctuate over the years to come due to the structured payout of the various settlements, the annual report also states that “all 95 counties will receive at least one annual payment from the Opioid Abatement Trust Fund during quarter 1 of each calendar year.” Some of the settlement agreements pay out for as long as 18 years, so each of the 95 counties will receive some financial assistance for its local abatement efforts for quite some time.

Updated Payment Projections for Counties Published to OAC Website

In addition to what counties have received so far, the Council has provided “rolling”

payment projections until 2026 at the request of counties. It’s important to note that the projections are only for those first quarter anticipated annual payments and that the provided projections aren’t final. To see the payment projection chart for individual counties, visit the Opioid Abatement Council website at www.tn.gov/oac/county.

UT SMART Initiative Provides Technical, Hands-On Assistance to Tennessee’s 95 Counties

Whereas the Opioid Abatement Council was legally established and structured to provide more administrative assistance to county governments and nonprofits fighting the opioid crises, the University of Tennessee’s Substance Misuse and Addiction Resource for Tennessee (SMART) initiative provides more technical, direct assistance to county governments.

This new organization within the Institute for Public Service was created to

assist local governments in planning how to wisely invest the settlement funds they

are receiving. SMART consultants, much like UT CTAS county government consultants, cover “the field” of Tennessee’s three grand divisions, using much more technical knowledge-based resources and strategy. For more information about SMART and its services, please visit smart.ips.tennessee.edu.

What’s Next for Counties Combatting the Opioid Crisis?

As counties continue to launch programs and implement strategies that combat

the opioid crises on a local level, we have many partners and state agencies that are willing to assist in technical implementation and also share the stories of hope, similar to the stories we’ve included in this magazine. In addition to the direct funding provided

to counties, the Opioid Abatement Council has a competitive grant process that provides

even more funding to programs across the state. As these funds continue to be allocated — including to community organizations, universities and other entities— there are plenty of opportunities to face these challenges head-on. As we know with so many other issues, the most effective way to tackle local challenges is to find local solutions — and these opioid

abatement funds are opportunities to do just that.