NJ advocates demand stricter oversight of opioid settlement spending

New legislation would require municipalities to repay improperly spent funds and impose deadlines for using settlement money.

Every day, harm reduction workers across New Jersey distribute clean syringes, fentanyl test strips, and Narcan to people who use drugs, helping prevent overdose deaths and the spread of disease. They also provide basic medical care and help those struggling with addiction find housing, treatment and other services, often with limited resources.

New Jersey is expected to receive more than $1.1 billion through 2038 from settlements with opioid manufacturers, distributors and retailers. At an Assembly hearing Thursday, advocates demanded stricter oversight of the money, which is intended to address the damage caused by the opioid epidemic. But investigations have revealed that some municipalities in the state spent portions of their funding on concerts, police vehicles, clothing and other questionable expenses.

Precious Kirby, director of community engagement for Black Lives Matter Paterson, told lawmakers that staff at the organization’s harm reduction centers sometimes rush out of their offices to administer Narcan to reverse opioid overdoses.

“When people are asking for our staff, they aren’t asking us if we have popcorn, cotton candy, or a nice $600,000 concert,” Kirby said. “They’re asking: ‘Who has Narcan?’ Because when someone is dying from an overdose, we don’t need a concert to remind us that overdoses exist.”

Kirby joined addiction specialists, harm reduction workers and social justice advocates in calling for tougher spending restrictions, greater transparency and more investment in services that directly help people affected by addiction.

At the almost three-hour hearing before the Assembly Oversight, Reform and Federal Relations Committee, advocates also demanded greater involvement by the people affected by addiction in deciding how the settlement money is spent.

Kirby offered an example of the need for more direct investment in overdose prevention. A 2024 survey by her organization found that nearly 60% of the people who use drugs surveyed did not know where to obtain naloxone, which is the generic name for Narcan.

Black Lives Matter Paterson subsequently launched a neighborhood health initiative to expand access to the medication. Kirby testified that the program now distributes more than 500 naloxone kits every month.

Investigations revealed questionable spending

Some municipalities have spent settlement funds on police vehicles, consulting services, clothing, monogrammed jackets and concerts billed as opioid-awareness events. Other municipalities like Summit and Aberdeen have left the money unspent for as long as three years.

In July 2025, the New Jersey Office of the State Comptroller found that Irvington wasted $632,502 on two concerts billed as opioid awareness events in 2023 and 2024. The spending included $368,500 in contracts improperly awarded to businesses connected to a township employee, more than $200,000 for advertising and promotional materials, and nearly $13,000 for luxury trailers for performers.

Irvington officials challenged the findings in court, alleging defamation and overreach by the Office of the State Comptroller. Superior Court Judge Robert Lougy dismissed the claims with prejudice in July 2026, finding that Irvington had failed to allege sufficient facts to support its claims. He also rejected the city’s attempt to revive the lawsuit with an amended complaint.

The comptroller’s investigation also criticized the state Department of Human Services for failing to provide adequate guidance and oversight of municipal spending. The agency recommended stronger monitoring and clearer spending rules.

Under existing state law and national settlement agreements, the overwhelming majority of settlement funds must support evidence-based or evidence-informed programs addressing opioid use disorder, including treatment, prevention, harm reduction, and recovery services. No more than 5% may be used for certain other purposes, including legal and administrative costs. The money also cannot be used to replace existing government funding for approved programs. Instead, it must supplement those expenditures.

Counties and municipalities are required to submit annual spending reports to the Department of Human Services, which is responsible for ensuring local expenditures comply with settlement restrictions in consultation with the comptroller and attorney general.

Advocates call for enforcement, not just guidance

Several advocates told lawmakers that guidelines already exist but are not being adequately enforced.

Elizabeth Burke Beaty, founding executive director of Sea Change, a state-authorized harm reduction center, said organizations working directly with people affected by addiction are often excluded from local funding decisions.

“I’ve seen too many expenditures so far that are misaligned with the purpose of these funds while trusted community-based organizations struggle for very limited resources, if any at all,” she said. “This must change, and you all have the power to help make that happen.”

Burke Beaty, who testified that she has been in recovery for 34 years and has lost her father, cousin, and numerous friends to addiction, said her organization distributes naloxone, provides overdose prevention supplies, and connects people with treatment, housing, and health care.

She questioned assertions that municipalities lack information about appropriate uses for the money, pointing to existing state settlement agreements, national guidelines, and resources developed by advocates.

“There are resources. There is guidance. There’s a lot of guidance,” she said.

She urged the Legislature to require public reporting, evidence-based spending plans and measurable outcomes, and to hold decision-makers accountable for misuse of the money or using it to replace existing government funding.

“Opioid settlement funds are not a slush fund for budget gaps, unrelated expenses or punitive initiatives disguised as prevention,” she said. “They must repair harm, save lives, and invest in communities completely devastated by this crisis.”

Burke Beaty also announced that advocates were filing a petition with the Department of Human Services seeking stronger regulations governing local opioid settlement spending. The petition, part of the newly launched Repair and Care campaign, calls for enforceable spending standards and greater public accountability.

Jenna Mellor, executive director of the New Jersey Harm Reduction Coalition, described the campaign as an effort to make sure settlement money reaches communities harmed by the epidemic rather than being used to fill government budget gaps.

Marie Verna of the New Jersey Association of Mental Health and Addiction Agencies said the state’s Opioid Recovery and Remediation Advisory Council had already developed strategies for appropriate spending. Municipalities that adopted an “overly broad interpretation” of permissible uses should reassess community needs and redirect money toward programs that improve the lives of people affected by addiction and their families, she said.

Verna recommended publicly accessible dashboards showing spending reports, program plans and results, along with investments in staffing and infrastructure to help organizations coordinate services.

“The oversight is absolutely necessary,” she said. “Full-on monitoring, just like schools.”

Bre Azañedo, a member of the Opioid Recovery and Remediation Advisory Council, warned that without statewide standards, spending decisions could create a patchwork of local programs favoring organizations with political influence rather than those best equipped to address addiction.

“Accountability can’t start at the county level or the municipal level,” Azañedo testified. “The state has to set those standards.”

She said the settlement dollars represented “lives that are lost, devastated families, communities that have endured both the overdose crisis and the decades of punitive and racist drug policies.”

Raquel Romans-Henry, director of policy and advocacy for Salvation and Social Justice, urged lawmakers to prioritize community-led crisis response, violence intervention, supportive housing, harm reduction and recovery services, particularly in Black communities disproportionately affected by both the overdose crisis and decades of punitive drug policies.

Linda Brown, executive director of the New Jersey Association of County and City Health Officials, called for public health officials to be included in funding decisions.

Arron Wheeler, an outreach worker with the Newark Community Street Team, said his mother struggled with opioid addiction, and his uncle died in an abandoned building after becoming addicted to prescription drugs.

“People died for that money,” Wheeler told lawmakers. “Let’s get the money to where it belongs.”

He urged lawmakers to give community organizations and people affected by addiction a voice in deciding how settlement funds are allocated.

Local officials say they need clearer rules

Municipal and county officials pushed back against suggestions that local government officials had intentionally violated spending restrictions. Several said existing guidelines were too broad and that towns needed more specific instructions about permissible expenditures.

“There was guidance, but not specific guidance,” said Raymond Heck, mayor of Millstone Borough in Somerset County and a past president of the New Jersey State League of Municipalities. “There were areas that said ‘prohibition’, what you couldn’t use it for, but there was a lot of flexibility around it.”

Heck disputed allegations that local officials were knowingly misusing settlement funds.

“It wasn’t that people were doing wrong … I don’t believe anybody was doing wrong, per se,” he said.

Somerset County Administrator Colleen Mahr agreed that municipalities need a reliable way to determine whether proposed spending complies with settlement agreements.

“Our experience is local governments want to do the right thing correctly, but they would benefit from a review, or a place where they can go, to either confirm or endorse that the money they’re going to spend aligns with the settlement agreements,” she told lawmakers.

Mahr described Somerset County’s efforts to put settlement funds into community programs, including paying outreach workers to knock on more than 100,000 doors over two years and distribute more than 1,000 Narcan kits. The county has also funded a mobile harm reduction program, recovery support specialists, and grants to nonprofit organizations. One county initiative provides temporary pet care for people entering residential addiction treatment, removing a potential barrier for people who otherwise might not seek help.

Mahr recommended stronger state oversight, consequences for government agencies that fail to submit spending reports, and greater regional collaboration.

Jackie Veasy, mayor of Evesham Township and president of the New Jersey Conference of Mayors, called for “clear and consistent guidance on eligible expenditures, documentation, and reporting requirements.”

She also recommended technical assistance and examples of evidence-based programs, collaboration among local governments, law enforcement, treatment providers and nonprofits, and consistent measures for evaluating results.

“We encourage the state to provide a consistent framework for measuring results while recognizing that community needs and program priorities differ,” Veasy said.

The township had spent about $102,564 in settlement funds and had approximately $257,633 remaining, Veasy said.

Deputy Mayor Heather Cooper said her brother Bob died of an opioid overdose in 2018 at age 42 after struggling with addiction for two decades. A father of four, he had faced difficulties obtaining housing, health care and steady employment during periods of recovery.

“Heather, don’t let people fall through the cracks,” Cooper recalled her brother telling her.

She said his death helped motivate her work to ensure that settlement money supports services capable of helping people rebuild their lives.

Schnall acknowledged the repeated requests from local officials for more guidance.

“We all got that message,” he said.

Bill would impose spending deadlines and require repayment

Assemblyman Cody Miller, a Democrat representing parts of Atlantic, Camden and Gloucester counties, introduced bill A5588 on Oct. 5 to expand oversight of state and local opioid settlement spending.

Under the proposal, state, county, and local government bodies would have 18 months after receiving settlement funds to spend them. Multiyear projects could follow approved spending schedules, while governments unable to meet the deadline could request an extension or return the money for redistribution. The bill would also require recipients found to have spent money improperly to reimburse the funds within 60 days of receiving written notification, although extensions could be granted.

The legislation would strengthen the Department of Human Services’ oversight responsibilities in coordination with the state comptroller and attorney general and require governments to post links to the comptroller’s online complaint form so residents can report suspected fraud, waste, or abuse. The Opioid Recovery and Remediation Advisory Council would also be directed to establish a training program for county and municipal officials and a process for requesting guidance on proposed expenditures. Council members would be prohibited from participating in decisions involving direct or indirect financial interests.

Stephanie Gorman of the New Jersey Association of County and City Health Officials cautioned that municipalities would need predictable payment schedules to meet the proposed 18-month spending deadline.

“If a town does not know how much it will receive or when the payment will arrive, it may be difficult to budget and certify the funds needed for a contract or a program,” she said.

Lawmakers promise further action

Schnall said Thursday’s testimony underscored the need for a designated state official whom municipal officials could consult before committing settlement money to particular programs.

“We need to have a live human being that will be able to answer municipalities’ questions,” he said. “So, when a municipality has a program, an idea, or something they want to use that money for, they can ask, ‘Is this good? Is this not good?’”

He also suggested creating a task force to develop more effective statewide spending guidelines. Schnall said lawmakers would continue meeting with stakeholders and revise the legislation.