Dunn County accepts opioid settlement of $1.25 million
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By LeAnn R. Ralph
MENOMONIE — The Dunn County Board has accepted a settlement of $1.25 million to cover expenditures related to the opioid epidemic as part of claims against the three largest pharmaceutical distributors and Johnson & Johnson and its subsidiary companies.
The money must be targeted toward treatment, programs and services intended to help with the abatement of the opioid epidemic, said Nick Lange, Dunn County Corporation Counsel, at a special meeting of the Dunn County Board December 15.
The county board typically does not meet in December.
The settlement money will help to provide additional funding for services and programs in the future but cannot be used to make adjustments for expenditures in the past, Lange told the county board.
According to background information provided to the county board, “thousands of counties, cities, townships and other local governmental units throughout the United States, and a number of states, currently have the same or similar claims pending.”
The settlement was the product of a tremendous amount of litigation, and a federal court in Ohio consolidated the cases, Lange said.
The three largest pharmaceutical distributors listed in the background information are McKesson Corporation, Cardinal Health, Inc., and AmerisourceBergen Corporation.
Terms
The basic terms of the settlement are that the distributors will pay a maximum of $21 billion over 18 years, and J&J will pay a maximum of $5 billion over no more than nine years, according to the background information.
Dunn County will receive an estimated $1,254,283.66 by installments over the 18-year period.
Tim Lienau, county board supervisor from Menomonie, asked what kind of guidance would be provided for spending the settlement money.
When the funds are received, there will be some oversight from a board that will be created to establish rules, Lange said.
There will be limitations as to how the money can be spent, but Dunn County Human Services, the Criminal Justice Collaborating Council and the Dunn County Sheriff’s Department are already doing many of programs and services that would be covered, he said.
Following the rules will not be difficult, and there will be some kind of accountability from a reporting standpoint, Lange said.
Tobacco settlement
Larry Bjork, county board supervisor from Menomonie, commented that the opioid settlement seemed similar to the settlement with tobacco companies.
In the tobacco litigation, the state of Wisconsin filed the claim and said “Don’t worry. We know you have incurred expenses. When it’s over, we will give you your share,” Lange said.
When the tobacco litigation was over, the state said, “never mind, we’ll keep it,” so there was no settlement money for individual municipalities to cover the cost of programs and services, he said.
According to a December of 2007 report, “A Broken Promise to Our Children: The 1998 State Tobacco Settlement Nine Years Later,” “In 2002, the [Wisconsin] Legislature and then-Governor Scott McCallum (R) enacted a budget that securitized, or sold to investors, virtually all of the state’s tobacco settlement payments over the next 20 to 25 years. More than $5.9 billion in anticipated settlement payments were sold for an immediate lump sum of $1.6 billion, all of which was used to address the state’s budget deficit. Securitization meant that Wisconsin would have no tobacco settlement money to fund tobacco prevention programs for more than two decades, and would need to rely on other sources of funding such as a cigarette tax increase or general funds.”
A tobacco settlement payment of $5.9 billion, divided by 25 years, divided by 72 counties in Wisconsin, if the money was divided up equally among the counties, amounts to $3.3 million per year in funding per county over the 25-year period.
Counties
With the opioid settlement, Wisconsin counties were “quick to move on it,” Lange said.
All of the counties were able to make claims to establish a firm foundation for moving forward with the litigation before the state of Wisconsin became involved, he said.
The court does not want the money to be a cash infusion for general fund purposes, but rather to cover the cost of deaths, property damage and crime and to provide services related to opioid addiction, Lange said.
The Criminal Justice Collaborating Council will have insight on using the money for drug treatment courts and other treatment programs to help people get back into society, said Sheila Stori, county board supervisor from Menomonie.
The CJCC and the human services department are excellent candidates for using the funds for existing programs or for launching new programs, Lange said.
The settlement tells Dunn County what the county is getting, but what is the counting giving up? asked Tim Niehoff, county board supervisor from Menomonie.
The distributor settlement agreement included in the county board packet is 606 pages, and the Johnson & Johnson settlement agreement is 190 pages.
Dunn County is giving up the right to make additional claims against the defendants, Lange said.
Part of the settlement is that Dunn County will not file another lawsuit, he said.
The settlement was the result of years of litigation and settlement discussions with the oversight of the court, and it is “the best deal we could get,” Lange said.
There are other instances where the plaintiffs lost their claims, and the manufacturers prevailed, he said.
The court entered an order and wants participation, which “makes it hard to say no,” Lange said.
The Dunn County Board unanimously approved accepting the opioid settlement.
The next meeting of the Dunn County Board is January 19.
