PRESENTER: Presenter
Valeria Acevedo, City Attorney
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SUBJECT: Title
Approval of a resolution of the City Council of the City of New Braunfels, Texas approving participation in a settlement agreement between the State of Texas and six regional distributors/dispenser defendants (Remnant Defendants Settlement): Associated Pharmacies, Inc. (and American Associated Pharmacies); J M Smith Corporation; Louisiana Wholesale Drug Company, Inc.; Morris and Dickson Co.; North Carolina Mutual Wholesale Drug Company, Inc.; and United Natural Foods, Inc. (including its subsidiaries SuperValu and Advantage Logistics); and authorizing the city manager to execute the Combined Subdivision Participation and Release Form.
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DEPARTMENT: City Attorney’s Office
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COUNCIL DISTRICTS IMPACTED: Citywide
BACKGROUND INFORMATION:
Texas is one of the lead states currently negotiating financial settlements with the nation’s largest companies in the opioid supply chain. On May 13, 2020, Texas, along with a broad, bipartisan coalition of states and subdivisions, reached two final agreements with four companies to resolve legal claims against for their role in the opioid crisis. In September 2021, City Council adopted the Texas Term Sheet as required by the settlement agreement and opted into those settlements with McKesson, Cardinal Health, ABCD, and Janssen/Johnson & Johnson, Endo/Par and Teva. (Resolution No. 2021-R-51). Funds are to be used only to address opioid related harms and in accordance with the guidance provided by the 87th Legislature General Appropriations Act and Exhibit B of the Global Settlement Allocation Term Sheet dated May 13, 2020: <https://comptroller.texas.gov/programs/opioid-council/docs/texas-settlement-allocation-term-sheet.pdf>
The city was awarded approximately $307,313.00. As with all payments, they will be made payable in varying amounts over an 18-year period. To date, the city has received 3 payments. The City received $96,471.88 on March 15, 2023, $18,767.90 on April 16, 2024, and $91,559.54 on April 1, 2025. These payments are available on the state’s website at: <https://comptroller.texas.gov/programs/opioid-council/funds/poli-sub-disbursements.php>
In 2023, the city participated in another settlement agreement with Allergan, CVS, Walgreen, and Walmart (Resolution No. 2023-R26) from which the City expects to receive $289,592. On November 25, 2024, by Resolution No. 2024-R79, the City opted into the settlement with Kroger with the expectation of receiving a portion of those settlement funds which total $23,145.47.
In 2025, the city participated in a settlement agreement between the State of Texas and opioids manufacturers, Alvogen, Amneal, Apotex, Hikma, Indivior, Mylan, Sun, and Zydus (Resolution No. 2025-R53). These funds (amounts not yet determined) are supposed to be paid out over a period not to exceed 10 years.
On March 5, 2026, the City received notice of this recent settlement agreement with Six Remnant Defendants listed in the caption of this resolution and advising that we have until May 4, 2026, to opt-in. The total pooled amount of that settlement is $97,625,000.00. Exhibit E, page E-110 of the settlement lists the City of New Braunfels as receiving 0.0145509503%, which equates to $14,205.36+/-. To read the complete settlement overview, please see document entitled “Settlement Overview” attached to this agenda item. Detailed information about the Settlement may be found at: <https://nationalopioidsettlement.com/>
ISSUE:
In order to participate in the Six Remnant Defendants settlement agreement, the City Council must opt in and authorize the city manager to execute and submit the Combined Subdivision Participation and Release Form attached to the resolution by the deadline of May 4, 2026.
STRATEGIC PLAN REFERENCE:
☐Economic Mobility ☐Enhanced Connectivity ☐Community Identity
☒Organizational Excellence ☒Community Well-Being ☐N/A
FISCAL IMPACT:
The amount of funds the city stands to receive under this settlement agreement is unknown until the State of Texas knows how many cities will participate. The use of funds is limited to the prevention, detection, abatement, and treatment of opioid abuse.
Recommendation
RECOMMENDATION:
Staff recommends approval in order to receive settlement funds.