Budget proposes directing opioid settlement and other off-budget funds to maintain programs; committee seeks transparency

Jeff, secretary of the Office of Policy and Management, said the state has received about $130 million so far from opioid settlements and expects additional proceeds. He told the committee the administration proposes directing disbursements through the existing opioid settlement committee rather than sweeping the funds into the general fund, and to use up to one-third of settlement proceeds for state costs per the settlement agreement.

The secretary said those opioid settlement disbursements would keep a variety of programs operating (some of which had been started with ARPA funds) and that doing so would conserve spending-cap room. He also said the administration plans to leave certain cannabis Social Equity Council funds off-budget as originally intended and to work with that council to direct some of those dollars toward housing instability and homelessness programming.

Why it matters: Committee members asked for clarity on what "off-budget" means, how those accounts are governed and whether the administration's use of settlement and other off-budget funds effectively commits future policymakers. The secretary said OFA (the committee's fiscal office) can supply a list of off-budget accounts and that the administration will work with lawmakers on proposed back-of-act language that authorizes the settlement committee's disbursements.

Context and limits: Officials described this approach as consistent with the attorney general's settlement agreement and existing statute governing the settlement committee; members asked for a clear inventory of off-budget funds and the long-term implications of using settlement proceeds to supplant other ongoing dollars.