Some opioid settlement funds may sit untouched in Michigan. Here’s why

• Michigan is slated to receive an estimated $1.6 billion in opioid settlement money over 18 years 
• Under the latest settlement proposal, Kroger will add another $42 million to that total for its alleged role in the opioid crisis
• But distribution is complicated. One county gets $2M, one township gets $10.39

Designed to save lives, millions of dollars in opioid settlement money is heading to local governments to combat Michigan's deadly drug crisis. But as the latest settlement agreement illustrates, sometimes it’s easier — and maybe a better deal — to leave that money on the table.

“The money isn’t high enough to justify the time” to fill out the paperwork for it, said Kelly VanMarter, township manager of Genoa Township in Livingston County.

She said looked at the $25.68 that her township would receive over 10 years and had a brief conversation with other township officials. The decision wasn’t difficult, she said: 

After paying for her time to fill out paperwork, she said, it would be a budgetary “deficit.”

At issue is a $1.4 billion settlement between Kroger and 33 states and the District of Columbia. Approved last year, it’s the latest in a growing list of settlements designed to exact funding from those blamed for a crisis that has caused an overdose death about once every four hours in Michigan.

Under the national settlement terms, 33 states where Kroger operates will share $1.2 billion, with the remaining funds destined for tribal communities and legal fees. Kroger does not admit wrongdoing or liability as part of the pact. 

Michigan will receive nearly $42 million from the settlement over 11 years. But it’s in the division of that money that the complexities become clear. 

Related:

• In Michigan’s vast UP, finding help for drugs is hard. So is finding solutions
• Opinion | Tackle Michigan's opioid crisis with careful planning, not quick spending
• Read Bridge’s ongoing coverage on how opioid settlement funds are being used — or saved — to tackle Michigan's drug crisis.

The state, itself, will receive half under a 50-50 split agreement with local governments — nearly $21 million. Shares among local governments are based on the number of residents with opioid use disorder, overdose deaths, and the amount of opioids dispensed there.

Wayne County, for example, may tap into more than $2 million in Kroger settlement funds if the deal is finally approved. In contrast, Union Charter Township in Isabella County would receive $10.39, according to the attorney general’s payment estimator.

As of midday Thursday, 41 of 278 government entities hadn’t filled out the paperwork to accept the funds allocated to them, according to Michigan Attorney General Dana Nessel’s office.

Nessel has been meeting with community leaders and advocates around the state to urge communities to spend the money thoughtfully. The office has alerted local governments to the Kroger shares — by email and by public announcements, according to Matt Walker, assistant attorney general overseeing the division of funds.

He said it’s “easy” for governments to claim the funds; they essentially sign some online documents, he said. But for some, he acknowledged, the decision might be to leave the funds unclaimed, allowing the dollars to instead “roll up” to county budgets.

The distribution of the latest settlement reveals the complexities in decision-making over such funds. Already, local governments are caught in a balancing act as they decide how to distribute funds in their communities — charged with taking the time to spend the money wisely, but also not wishing to let funds linger unspent as Michiganders with substance use disorder and their families continue to suffer and die.

The first step is deciding whether to take the funds in the first place.

In Southfield Township in Oakland County, Supervisor Jim O’Reilly believes that every dollar should end up in the budget for which it was destined rather than being left on the table for others.

About a week ago, he said, the township received a handful of checks adding up to $171. 

Yes. Dollars. Not thousands of.

“One hundred and seventy-one, point zero, zero,”  he said. It’s a small amount, in part, because the township has just 39 residents who live outside of its three villages. 

So the money will sit there — adding a few dollars here and there — until it’s substantial enough to address even a small part of the crisis, he said.

“We want to make sure the money is used, rather than sit back and wonder what anyone else would do with it,” he said.