Waste of the Day: Mismanagement Plagues $50 Billion Opioid Settlement

Topline: As money from opioid settlements began being distributed across the U.S. this May, the Associated Press warned that “local governments may not have the bandwidth to take the right steps to identify their communities’ needs and direct their funding shares to projects that use proven methods to prevent deaths.”

Opioid settlement money is not going where it could do the most good

Those concerns now appear more valid than ever. 

State and local governments are receiving $50 billion to combat the opioid epidemic after successful lawsuits against drug companies for their alleged role in causing the crisis. But recent scandals in New York, Delaware, Pennsylvania and more have shown that many states are not ensuring the money goes toward initiatives that will have tangible impacts on addiction and drug abuse. 

Key facts: In July, Delaware Attorney General Kathy Jennings asked her state to pause all opioid settlement spending because its disbursement was “rife with potential for fraud, waste and abuse.” The state had already allocated $14.4 million at that point and ignored Jennings’ pleas by giving out another $2 million days later.

Philadelphia was recently found to have spent $7.5 million of its settlement money on upgrading playgrounds and repairing roofs instead of fighting drug addiction as intended.

Shasta County, California announced plans this October to award its $40 million settlement to “any individual or organization that wants a cut” and can win over legislators with a six-minute presentation, ShastaScout reported. 

The county board will approve funding on the spot, ignoring critics who say the county needs a strategic plan that uses evidence-based metrics to ensure the funds will actually fight addiction.

Other states have at least recognized they need more time to prepare the funds for dispersal.

Red tape

Counties on Long Island, New York have received $213.5 million from opioid settlements over the last three years and committed $97 million of it to specific grants and contracts. But only $8 million has actually been paid out, Newsday reported in December, due to a “lack of urgency, … bureaucratic red tape and a cumbersome grant reimbursement process.”

Only 19 states are being fully transparent by reporting how their settlement funds are being spent.

Search all federal, state and local government salaries and vendor spending with the AI search bot, Benjamin, at OpenTheBooks.com. 

Summary: The $50 billion in opioid settlement funds may not come directly from taxpayers, but it is still public money once it enters the state coffers. Citizens are paying public salaries to their elected officials with the expectation that they will manage all government funds effectively.

And if governments can’t figure out how to use the settlement funds responsibly, why should voters be confident their tax dollars will be spent properly?

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com.

This article was originally published by RCI and made available via RealClearWire.