Alliance Alert: We welcome the news that New York State’s opioid settlement funds have accrued $35 million in additional interest, but we remain deeply concerned that hundreds of millions in settlement dollars have yet to be distributed to the communities most affected by the overdose crisis. While these funds have the potential to transform addiction treatment, prevention, and recovery services, they cannot save lives while sitting in state accounts.
New York must act quickly and wisely to ensure these funds reach providers and communities on the frontlines of the opioid epidemic. We strongly agree with the Opioid Settlement Fund Advisory Board’s recommendation that the newly accrued interest be used to support smaller, community-based organizations that are too often excluded from the state’s procurement process. These organizations — many led by peers and people with lived experience — are essential for reaching individuals in underserved and rural areas who have been hit hardest by the opioid and overdose crisis.
This action is especially urgent now, as the federal government retreats from funding proven harm reduction strategies such as syringe service programs, housing first initiatives, and other vital public health interventions. With federal resources diminishing, New York’s opioid settlement funds must fill the gap — sustaining harm reduction, treatment, and recovery supports that save lives and strengthen communities.
The Alliance will continue to push for timely, transparent, and equitable distribution of these funds to ensure they are used as intended — to expand access to voluntary, community-based support and to help all New Yorkers affected by substance use find safety, healing, and recovery.
New York’s Unspent Opioid Settlement Funds Accrue $35M amid Criticism of Slow Disbursement
By Ethan Geringer-Sameth | Crain’s Health Pulse | October 23, 2025
New York has earned $35 million in interest on its opioid settlement funds since 2022, according to state officials — money that has piled up while millions designated for addiction treatment and prevention remain unspent.
The yields come amid criticism from providers and members of an advisory board responsible for recommending uses for the fund that the state’s roughly $500 million in settlements with drug companies have not gone out the door fast enough. The interest, which went back into the fund, according to Chief Budget Examiner Peggy O’Shea at a recent meeting of the Opioid Settlement Fund Advisory Board, comes in as the state’s investment yields have grown in recent years. The money now provides a new opportunity to support drug abuse deterrents and treatment ahead of the board’s annual report due next month.
The settlement funds are part of the state’s general checking and are invested by the comptroller’s office along with the rest of available state cash, said Jennifer Freeman, a spokeswoman for the office. The comptroller’s Short-Term Investment Pool, which invests the funds, is used to maximize interest earnings after setting aside money needed to make payments for the state. In recent years, the interest rate on the pool has grown, from an average yield of .089% in fiscal year 2022 to close to 5% last fiscal year, according to the comptroller’s monthly cash report.
The advisory board has been seeking information about the interest accrued for months, after criticism that the state Office of Addiction Services and Supports has not disbursed the settlement funds in a timely manner. That slow pace has allowed millions of dollars in crisis funding to earn interest while sitting idle, said Tracie Gardner, executive director of the National Black Harm Reduction Network and a member of the advisory board.
“That’s a lot of money just sitting there. That’s how interest accrues: just sitting there,” she said.
The state has received over $500 million from drug companies, of which $454 million has been made available, according to OASAS spokesman Evan Frost. But over $100 million of the available total had not been delivered to providers as of the spring, Crain’s reported in July. The money that has been spent includes $157 million to counties for drug abatement work and long-term contracts with providers, according to Frost.
Frost said the agency has followed state procurement laws, saying the delay reflects that many of the awards are for multi-year contracts, which do not disburse funding all at once. “This was a request from the board to ensure that these projects remain sustainable over the long term,” he said.
The advisory board recommended the interest be used to support organizations that are too small to navigate the procurement process to receive funds. In a non-binding resolution, the board said the state should tap a well-established agency to subcontract with smaller providers that have been unable to access funds, Gardner said. The board is now drafting its recommendations for the use of the funds in the upcoming fiscal year, ahead of the next legislative session.
The state has the final decision on how to spend the fund, which it will make after the advisory board’s report is due on November 1, said Health Department spokeswoman Cadence Acquaviva.