Huerfano County among first to stake claim to opioid settlement money; one Las Animas town would get $44

HUERFANO COUNTY — In early 2018, Huerfano County was the first governmental body in Colorado to sue several “big pharma” companies for their role in fueling an opioid crisis which continues to leave the nation reeling.

And on Tuesday, the county was among the first three in the state to line up for its share of an estimated $400 million Colorado stands to receive from various litigation settlements.

Commissioners unanimously approved a memorandum of understanding with the Colorado Department of Law that begins to set the wheels in motion to receiving and disbursing settlement funds.

That money could start coming in summer 2022, according to the state attorney general’s office.

In addition to Huerfano County, Fremont and Montezuma counties have approved the MOU — the first steps in an attempt to get all 64 counties and 271 municipalities to sign on to the state’s plan by Jan. 2, 2022, according to Colorado Attorney General’s Office spokesperson Lawrence Pacheco.

If it gets unanimous buy-in on its plan, Colorado stands to receive over $400 million over time from opioid settlements announced to date, including $300 million from Johnson & Johnson and the drug distributors, and $10 million from McKinsey & Company, Pacheco said. The state will also receive $75 million from Purdue Pharma and the Sackler family and $25 million from Mallinckrodt when the companies exit bankruptcy.

If a critical mass of local governments do not approve the MOU, the state could lose as much as half that amount.

How the settlement money would be distributed

The MOU is specific and detailed on how governments may use the settlement funds. All participants in the framework must use the funds they receive for opioid abatement purposes such as drug treatment, recovery, prevention and education, and appropriate harm-reduction programs, as well as addressing the epidemic’s impact on the criminal justice system.

But its plan for calculating how the settlement pie is sliced is a bit more Byzantine.

Under the terms of the MOU, 10 percent of the settlement funds will go directly to the state, 20 percent will go directly to participating local governments and 10 percent will be dedicated to statewide infrastructure projects related to opioid abatement.

The MOU divides the state into 19 regions and the lion’s share of the settlement, 60 percent of the funds, is earmarked for those regions. The governmental entities within each region will have two years to develop an organization to oversee and disburse those funds.

Each region will receive a percentage based on several factors, Pacheco said, including population and local impact from the opioid crisis.

“These regional collaboratives will have their own governing boards comprised of public officials from local governments in the region, will conduct their own needs assessments, and will develop community-specific plans for spending the funds they receive for opioid abatement programs,” the attorney general’s office said in an August release.

Huerfano and Las Animas counties will be in Region 19, the Southeast Region, along with Pueblo, Crowley, Kiowa, Otero, Bent, Prowers and Baca counties. Region 19 will receive 7.458 percent of the 60 percent earmarked for the “regional share.”

Pacheco said it will be up to each region’s governing board to determine how the funds will be spent and what amounts may flow to each entity within a region.

But the 20 percent earmarked specifically for local governments will flow directly to the local governments without a regional bureaucracy in between. Under the plan, Huerfano County would receive 0.2505 percent and Las Animas County would receive 0.6304 percent.

One town would get about $44

Within each county, the money would be divided among the local governments. Under the MOU, Huerfano County’s intra-county share would break down as follows:

  • Huerfano County: 68.2709 percent
  • La Veta: 11.0719 percent
  • Walsenburg: 20.6572 percent

Las Animas County’s intra-county share would be:

  • Las Animas County: 77.8076 percent
  • Aguilar: 0.0751 percent
  • Branson: 0.0101 percent
  • Cokedale: 0.0188 percent
  • Kim: 0.0101 percent
  • Starkville: 0.0087 percent
  • Trinidad: 22.069 percent

Based on these percentages — and assuming Colorado’s share of the nationwide settlement is, indeed $400 million — Huerfano County stands to receive about $138,000; La Veta about $22,188 and Walsenburg about $41,400. Similarly Las Animas County would receive about $392,400 and Trinidad about $111,300.

Tiny Starkville, slated to receive the smallest percentage at 0.0087 percent, can expect about $43.87, roughly enough money to buy two Naloxone overdose kits on Amazon (minus the Narcan nasal spray).

“We have a once in a generation opportunity to build much-needed capacity to support drug treatment, recovery, and prevention and education programs,” Attorney General Phil Weiser said in August. “In so doing, we will honor those impacted by the epidemic and we’ll save the lives of countless others from overdose and addiction.”

In making a motion to approve the MOU Tuesday, Huerfano County Commissioner John Galusha said, “this is going to be a big deal.”

“For Huerfano County, this may be somewhere around $350,000-$400,000,” he said. “But it is over time. It should be able to support several programs and a lot of state funding could come from this for things such as treatment facilities and education.”