Kentucky's Opioid Money: $109.8 Million Sits Unspent

Kentucky's counties and cities have collected $122.4 million from national opioid settlements since 2022 -- their half of restitution money that drugmakers, distributors and pharmacy chains paid after courts and attorneys general found them complicit in starting and prolonging the overdose crisis.▸ According to a Kentucky Center for Economic Policy⧉ analysis of the first detailed local spending reports the state has required -- reports every county and city that receives settlement money must file with the Kentucky Opioid Abatement Advisory Commission⧉ (KYOAAC), the state body Kentucky law⧉ created to collect and publish them -- $109.8 million of that money, more than 90%, had not been spent as of June 30, 2025. Kentucky lost 1,110 people to drug overdoses in 2025, the state's own count shows⧉ -- a real decline, but not a solved crisis, and not one that unspent restitution money is doing anything to solve faster.

The mechanics are set by KRS 15.293⧉, the statute governing Kentucky's opioid abatement trust fund: half of every settlement dollar the Commonwealth collects goes to the state, and the other half is paid directly to all 120 counties and 149 city governments, to spend on prevention, harm reduction, treatment and recovery support.▸ Nothing in that law puts a clock on the local half. The statute explicitly overrides Kentucky's normal budget rule that unspent appropriations lapse at year's end -- opioid settlement money "not expended at the close of a fiscal year shall not lapse but shall be carried forward into the next fiscal year," indefinitely, for as long as the settlements keep paying out through 2038. A county that banks its check and does nothing with it faces no deadline and no clawback for the inaction itself.

Fiscal year 2025 was the first year Kentucky required counties and cities to file detailed spending reports, and the results show how little urgency the money carries.▸ Of 269 counties and cities that filed reports, 138 -- 51% -- spent zero dollars on opioid abatement. That's 50 of Kentucky's 120 counties and 88 of its 149 cities, each required to explain the inaction: roughly a third offered no explanation beyond having spent nothing, and more than a quarter said they were still "in the planning process," a phrase now three fiscal years old for governments that started receiving checks in 2022.

Where money did move, KyPolicy reviewed 225 individual county expenditures against the 2026 National Roadmap for Spending Opioid Settlement Funds⧉ -- a spending guide endorsed by more than 230 addiction-response organizations that sorts uses into effective public-health investment versus purposes that are ineffective, unproven, or actively harmful.▸ Jefferson County put $130,796 toward a Feed Louisville outreach program that hands out naloxone and wound care to people living outside -- the kind of harm-reduction spending the Roadmap holds up as the model. Seventy-six expenditures, $7 million worth, cleared that bar.

Seventy-three did not.▸ Martin County spent $61,879 arming and fueling a constable's car and two "Opioid Deputies." Eight counties together spent $433,385 on NET devices -- FDA-cleared but unproven electrical nerve stimulators taped behind a patient's ear, with no established long-term outcomes and a price tag KyPolicy calls out as steep for the evidence behind it. And Grayson County spent $25,000 to bring former NBA player Lamar Odom to speak at the high school -- a program in the same bucket as the D.A.R.E.-style "just say no" campaigns the Roadmap has documented as ineffective for decades. In total, $1.7 million of the $12.2 million counties spent in FY2025 -- 14 cents of every dollar actually deployed -- landed in KyPolicy's "problematic" column.

Kentucky's statute does have teeth -- just aimed at the wrong target.▸ Under KRS 15.293⧉, the state can withhold a county or city's next settlement payment if it fails to file its required annual report to KYOAAC. There is no equivalent penalty for filing a report that says a jurisdiction spent nothing, or spent it on a celebrity speaker. The compliance mechanism enforces disclosure, not use -- it makes sure Kentuckians can see the money sitting still, but does nothing to make it move. Local governments' next reports are due by the same statutory deadline that produced this year's data; whether the $109.8 million balance shrinks or grows by then is entirely up to the same 269 governments that let it accumulate this far.