Title
Consider and take action on a resolution authorizing participation in a new opioid settlement with the Six Remnant Defendants (CL-2025065), and authorizing the City Manager to execute all necessary documents, including the Subdivision Participation and Release Form, and to participate in any subsequent opioid settlement cases (City Attorney)
Background:
Previous Opioid Settlement:
In 2021, the City Council approved participation in the Texas Opioid Settlement through Resolution No. 2021-130, which adopted the Texas Term Sheet and Intrastate Allocation Schedule and authorized execution of subdivision participation agreements with national opioid defendants.
New Opioid Settlement:
Since that time, additional national opioid settlements have been reached. The current item concerns a new and separate national settlement with six regional pharmaceutical distributors and dispensers (the “Six Remnant Defendants”), identified under reference number CL-2025065. This settlement arises out of the national opioid litigation (MDL 2804) and is governed by a standalone settlement agreement dated February 23, 2026. This settlement is not part of the Texas Opioid Settlement structure, does not utilize the Texas Term Sheet or intrastate allocation schedule, and does not involve the Texas Attorney General. Instead, funds will be distributed directly to participating local governmental entities that elect to participate. Participation requires execution of a Combined Subdivision Participation and Release Form by the May 4, 2026 deadline.
Settlement Overview:
The Six Remnant Defendants settlement provides for a combined national payment of approximately $97.6 million to eligible participating entities for opioid abatement purposes. Each participating subdivision’s allocation is determined based on a national pro rata methodology. Exhibit E reflects that the City’s allocation percentage is approximately 0.0125855219%, resulting in an estimated payment of approximately $12,000. This is anticipated to be a one-time payment upon effectiveness of the settlement.
Subdivision Participation and Release Form:
Participation in the settlement is effectuated through execution of the Combined Subdivision Participation and Release Form. By executing the form, the City elects to participate as a Participating Subdivision, agrees to release all claims against the Six Remnant Defendants related to opioid litigation, agrees to dismiss any pending claims if applicable, and accepts all rights and obligations under the settlement agreement. Execution of this form constitutes a binding legal release in exchange for receipt of settlement funds.
Use of Settlement Funds (Restrictions):
All funds received under this settlement are restricted and must be used solely for opioid remediation purposes as defined in Exhibit D of the settlement agreement. Permissible uses include treatment and recovery services, overdose prevention measures such as naloxone distribution, prevention and education programs, support services for individuals with opioid use disorder, and programs within the criminal justice system addressing opioid addiction. These restrictions are consistent with prior opioid settlements and require funds to be used exclusively for abatement of opioid-related harms. The City has previously used similar funds to support initiatives such as the Police Department’s mental health unit, and any future expenditures must comply with these requirements.
Fiscal Impact:
Estimated revenue is approximately $12,000 (one-time payment). Funds are restricted to opioid abatement purposes and no local match is required.
Recommendation:
Staff recommends approval of a resolution authorizing participation in the Six Remnant Defendants opioid settlement and authorizing the City Manager to execute all necessary documents and participate in future opioid settlement opportunities.
Attachments:
1. Proposed Resolution
2. Subdivision Participation and Release Form
3. Settlement Background
FUNDING
{X} If approved and funds are received, revenues will be posted based on restrictions of the settlement terms and budgeted in the future following those same terms.
STRATEGIC PLANNING
{X} NOT APPLICABLE