Nassau opioid settlement controversy erupts over transfer of nearly $14 million in interest

Nassau County Executive Bruce Blakeman's administration transferred nearly $14 million in interest accrued from unused opioid settlement funds to the county's general fund, where those dollars, targeted for drug abuse prevention, treatment and education, can now be used for any purpose, records show.

Meanwhile, Democratic lawmakers, activists and the parents of those who've lost loved ones to opioid abuse are urging Blakeman, the expected 2026 Republican gubernatorial candidate, to prioritize the disbursement of $95.5 million in settlement funds that Nassau County received as part of a settlement with drug manufacturers nearly five years ago.

To date, $15.54 million in settlement money has been paid to organizations, or about 16% of all funds, according to data from the county comptroller's office.

Blakeman's office says $43.3 million has been awarded to recipients ranging from universities to treatment centers, adding that it will take time for all of the money to get out the door.

Effort to address interest transfers

Data from Nassau's internal finance system, provided by county Democrats, shows that $13.69 million in interest was transferred since 2024 from the county's Opioid Litigation Fund into its general fund. Those dollars, which have been accruing since 2022, can now be used for any purpose, officials said, from payroll to outside legal fees.

Larry Lamendola, of Wantagh, whose daughter Lisa died of a fentanyl overdose in 2019, said the transfer is inappropriate and should be immediately reversed.

"Put back that money. That's blood money," Lamendola, co-chair of the Levittown Community Action Coalition, said at a Monday news conference in Mineola hosted by minority Democrats. "It is wrong."

In a statement, Blakeman spokesman Chris Boyle pointed to a declining number of annual opioid deaths in Nassau.

"Like all other county funds, the interest accrues to the general fund," Boyle said. "Opioid overdoses have declined by 16% in just the past year. The money is being put to good use."

But Blakeman administration officials previously stated they wouldn't use interest from the opioid fund for other purposes.

During an Aug. 5, 2024, Budget Review hearing, Andrew Persich, Nassau's budget director, was asked by lawmakers directly about transferring opioid settlement interest into the general fund.

"It's a requirement that it stays in there," Persich testified about the interest. 

The law governing the opioid settlement does not currently mention interest. A bill introduced Monday by Legis. Olena Nicks (D-Uniondale) mandates that any interest or investment income earned on opioid settlement money remain parked in the settlement fund.

"We need to make sure that we hold the administration accountable for getting the funds out and doing what’s right for the families of Nassau County," Nicks said at a rally Monday attended by more than a dozen activists calling for increased spending of settlement funds. "We cannot wait any longer, because addiction does not wait."

A spokeswoman for majority Republicans, who control the county legislature, did not respond to a request for comment on Nicks' bill.

Pace of spending questioned

The opioid funds were part of the more than $2.6 billion that entities statewide have received after 2021 settlements in a lawsuit over the opioid epidemic that 46 states and municipalities brought against pharmaceutical distributors. In 2022, settlements also were announced with three pharmacy chains and two additional drug manufacturers.

Nassau received $95.5 million in settlement funds, while Suffolk was awarded $120.9 million, records show.

A December 2024 Newsday investigation found that only a fraction of funds from both counties had been distributed to vendors.

At the time, Nassau and Suffolk had issued a collective $97.2 million in contracts and grants from the fund, but only $8.1 million, or less than 4% had been distributed to organizations and vendors, Newsday reported.

Presently, Suffolk has distributed $17.4 million in opioid funds but issued contracts and grants totaling $57.7 million, county spokesman Mike Martino said on Tuesday. Suffolk has not transferred any interest from the settlement fund, he said. 

While there are tight restrictions on how settlement money can be spent, there is no requirement that the money be used at all, experts said.

Democratic Minority Leader Delia DeRiggi-Whitton, of Glen Cove, argues the administration prefers not to spend the money because keeping millions in reserve helps the county's bond rating and lowers the cost of borrowing.

"It cannot be spent for anything other than the opioid fund," she said, "but it still gets the same credit for the county having savings or reserves."

Data from county Comptroller Elaine Phillips' office shows that $15.54 million has made it into the hands of organizations, up from $3.01 million in late 2024, records show.

A county spreadsheet from June obtained by Newsday supports Blakeman's assertion that $43.3 million in opioid funds has been awarded to date, often through multiyear contracts in which the money is dispensed annually. 

Among the funds awarded to date are $1.8 million as part of an opioid-related media campaign and $6.3 million that went to county departments, the Family Treatment Court and a consultant hired to help distribute the money.

Another program receiving funding, county officials said, is Rebound the Road, established by former NBA star Jayson Williams, which provides individuals with a history of substance abuse, homelessness or criminal pasts with assistance in passing commercial driver's license tests.

The program was awarded $200,000 in opioid settlement funds in each of the next four years for a total of $800,000.

By Robert Brodsky

robert.brodsky@newsday.com@BrodskyRobert

Robert Brodsky is a breaking news reporter who has worked at Newsday since 2011. He is a Queens College and American University alum.