Item Coversheet
Item #9.

Staff Report: 060-24

TO:

Mayor and City Council




FROM:

Eric Holmes, City Manager




DATE:

3/25/2024








SUBJECT


Approval of Interlocal Agreement with Cities of Camas and Washougal for Creation of Southwest Region Opioid Abatement Council
Key Points
  • To benefit from the settlements entered into by the State of Washington, the City agreed in April 2022 to the terms of the One Washington Memorandum of Understanding (One WA MOU), which details the prerequisites for spending settlement funds from litigation against the manufacturers, distributors, and retailers of opioids.
  • The City has received and will continue to receive payments from the State's settlements with the manufacturers, distributors, and retailers of opioids.
  • One requirement of the One Washington MOU is to establish a regional Opioid Abatement Council to ensure that all opioid funds are spent on approved purposes. The City can meet this requirement through an interlocal agreement with one or more of the participating local governments in the Southwest Region (Clark, Skamania, Klickitat Counties, Camas, Washougal, Battle Ground, Ridgefield).
  • Camas and Washougal are agreeable to the proposed interlocal, which enables the City to continue to be a direct recipient of the opioid funds to which it is entitled and then spend those funds for approved purposes.

Strategic Plan Alignment
Safe and Prepared Community – a safe place to live, work, learn, and play.                      
Present Situation

Since 2015, local governments around the Country have been united in efforts seeking to hold the manufacturers, distributors, and pharmacies of opioids responsible for the harms caused to their residents. The City of Vancouver joined this fight in 2019, filing suit against a number of manufacturers, distributors and pharmacies. That lawsuit was then transferred to the Northern District of Ohio as part of a nationwide multi-district litigation.

 

On April 4, 2022, Council authorized the City to execute a Memorandum of Understanding that specifies requirements for the expenditure of funds received in the opioid litigation while at the same time establishing a presumptive percentage to which the City of Vancouver would be entitled to receive (roughly 1.73% of anything payable to Washington local governments). Subsequently, the City Council agreed to join the State of Washington's settlements with opioid distributors (AmerisourceBergen Corporation, Cardinal Health, Inc., and McKesson Corporation) and retailers (Teva, Walgreens, Walmart, Allergan, CVS), from which the City is expected to receive over $7 million within the next decade. Claims against the defendants who have not settled remain pending.

 

The One WA MOU permits entities to receive direct payments had exercise discretion over the expenditures thereof provided that they be consistent with approved opioid abatement purposes. To ensure transparency and compliance with this requirement, the One WA MOU requires local governments to form Opioid Abatement Councils (OACs) within their respective regions. Negotiations to create this OAC have been ongoing since last year. Recently, Camas and Washougal have agreed to a proposal from the City for an interlocal agreement (ILA) to meet this purpose.

 

Under the proposed ILA, each municipality will operate as a subcommittee to ensure its own compliance with the One WA MOU requirements. Each municipality will receive direct payments as a result of any settlement, but and maintains the discretion spend those funds on any approved opioid abatement purposes (see Ex. A to One WA MOU). Ten percent of the funds may be used to cover overhead expenses.

 

Under the proposed MOU, the City of Vancouver would ultimately recover roughly 1.73% of moneys allocated to local governments in the State of Washington, as outlined in Exhibit B to the MOU. For example, if a settlement with all defendants yielded a distribution of $173 million to Washington's local governments, the City of Vancouver would be entitled to roughly $3 million, all to be used for opioid abatement purposes as outlined in Exhibit A to the MOU.

 

The MOU does not specify an exact sum for which the City of Vancouver would accept as settlement, but rather established a default allocation structure to facilitate resolution and avoid unnecessary litigation with other Washington and SW Washington jurisdictions.

 

Advantage(s)
  • Enables the City to comply with the One WA MOU requirements for expenditures of any direct settlement payments.
  • Allows City to retain complete discretion in how to spend opioid funds provided they are consistent with the approved opioid abatement strategies.

Disadvantage(s)

None


Budget Impact

Allows City to tap into settlement funds already received.


Prior Council Review
  • 4/4/2022: Approval of One WA MOU
  • 5/8/2023, 2/12/24: Discussion in Executive Session

Action Requested

Authorize the City Manager, City Attorney, and/or designee to execute and approve the attached Interlocal Agreement with the Cities of Camas and Washougal to establish the Southwest Region Opioid Abatement Council.

 

Dan Lloyd, Assistant City Attorney, 360-487-8520

 


ATTACHMENTS:
Description
Interlocal Agreement