H.F. 1038 DIVISION I 1 OPIOID SETTLEMENT FUND 2 Section 1. Section 12.51, Code 2025, is amended to read as 3 follows: 4 12.51 Opioid settlement fund. 5 1. As used in this section unless the context otherwise 6 requires: 7 a. “Administrative services organization” means the same as 8 defined in section 225A.1, as enacted in 2024 Iowa Acts, ch. 9 1161, §1. 10 b. “Behavioral health district” means the same as defined in 11 section 225A.1, as enacted in 2024 Iowa Acts, ch. 1161, §1. 12 c. “Department” means the department of health and human 13 services. 14 d. “District behavioral health advisory council” means the 15 same as defined in section 225A.1, as enacted in 2024 Iowa 16 Acts, ch. 1161, §1. 17 1. 2. a. An opioid settlement fund is created in the 18 office of the treasurer of state. The fund shall be separate 19 from the general fund of the state and the balance in the fund 20 shall not be considered part of the balance of the general fund 21 of the state. 22 b. (1) The state portion of any moneys paid to the state as 23 a result of a national settlement of litigation with entities 24 that manufactured, marketed, sold, distributed, dispensed, 25 or promoted opioids, made in connection with claims arising 26 from the manufacturing, marketing, selling, distributing, 27 dispensing, or promoting of opioids, shall be deposited in the 28 fund. 29 (2) (a) For each fiscal year for the period beginning July 30 1, 2025, and ending June 30, 2030, of the total amount of the 31 state portion of the moneys paid to the state as described in 32 paragraph “b” and deposited in the fund, plus any interest 33 and earnings on moneys in the fund, seventy-five percent is 34 appropriated to the department and twenty-five percent is 35 -1- HF 1038 (3) 91 lh/ko/md 1/ 8

H.F. 1038 appropriated to the office of the attorney general for purposes 1 of abating the opioid crisis in this state. 2 (b) Notwithstanding section 8.33, moneys appropriated 3 under subparagraph division (a) that remain unencumbered and 4 unobligated at the close of each fiscal year shall not revert 5 but shall remain available for expenditure for the purposes 6 designated until June 30, 2030. 7 (c) Notwithstanding section 12C.7, subsection 2, the 8 interest or earnings on moneys appropriated under subparagraph 9 division (a) are appropriated to the entity receiving the 10 appropriation to be used for the purposes designated. 11 (3) The department and the office of the attorney general 12 shall do all of the following: 13 (a) Review each administrative services organization’s 14 proposed uses of the appropriated moneys for crisis response, 15 early intervention, and treatment for opioid addiction, and 16 recovery from opioid addiction, for the behavioral health 17 district for which the administrative services organization has 18 been designated. 19 (b) Disburse the moneys appropriated under subparagraph 20 (2), subparagraph division (a), in accordance with the national 21 opioid settlement agreements and this section. 22 (c) Identify indicators and outcomes applicable to each 23 disbursement to be used to determine if the services and 24 activities that are funded achieve the intended outcomes, which 25 may include prevention of opioid-related deaths, reduction of 26 opioid misuse, and increased access to opioid use disorder 27 medications and services. 28 (d) Submit an annual report on or before November 1 to the 29 general assembly and the governor that contains all of the 30 following for the immediately preceding fiscal year: 31 (i) Information related to each disbursement from the 32 fund, and if the intended outcomes of each disbursement were 33 achieved. 34 (ii) Input from each district behavioral health advisory 35 -2- HF 1038 (3) 91 lh/ko/md 2/ 8

H.F. 1038 council regarding disbursements from the fund, intended 1 outcomes, and recommendations for future disbursements from the 2 fund. 3 (iii) A list of the current opioid-related initiatives 4 within the behavioral health district that are funded by 5 moneys from the national settlements that are earmarked for 6 or otherwise required to be transferred or distributed to 7 counties, cities, or other local governmental entities. 8 (e) Adopt rules pursuant to chapter 17A to administer this 9 paragraph. 10 (4) A recipient shall receive no more than one disbursement 11 under paragraph “b” , subparagraph (3), subparagraph division 12 (b). 13 (5) The department and the office of the attorney general 14 may, but are not required to, ensure that moneys appropriated 15 under subparagraph (2) are distributed equally to the 16 administrative services organizations. 17 (6) The department and the office of the attorney general 18 shall use no more than two and one-half percent of the moneys 19 appropriated under subparagraph (2) for administrative costs. 20 c. This subsection does not apply to such moneys paid to 21 the state that are earmarked for or otherwise required to be 22 transferred or distributed to counties, cities, or other local 23 governmental entities. 24 2. 3. a. Moneys in the fund shall not be transferred, 25 used, obligated, appropriated, or otherwise encumbered except 26 as provided in this section . 27 b. Moneys in the fund shall only be used pursuant to 28 appropriations from the fund by the general assembly for 29 purposes of abating the opioid crisis in this state, which 30 may include but are not limited to the purposes specified in 31 section 135.190A for moneys in the opioid antagonist medication 32 fund. 33 3. c. Notwithstanding section 8.33 , moneys in the fund 34 that remain unencumbered or unobligated at the close of a 35 -3- HF 1038 (3) 91 lh/ko/md 3/ 8

H.F. 1038 fiscal year shall not revert. Notwithstanding section 12C.7, 1 subsection 2 , interest or earnings on moneys in the fund shall 2 be credited to the fund. 3 DIVISION II 4 OPIOID SETTLEMENT FUND —— FY 2024-2025 5 Sec. 2. OPIOID SETTLEMENT FUND —— DEPARTMENT OF HEALTH AND 6 HUMAN SERVICES. 7 1. There is appropriated from the opioid settlement fund 8 created in section 12.51 to the department of health and human 9 services for the fiscal year beginning July 1, 2024, and ending 10 June 30, 2025, the following amount, or so much thereof is as 11 necessary, for the purposes designated: 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 29,000,000 13 2. Notwithstanding any provision of law to the contrary, of 14 the moneys appropriated to the department of health and human 15 services under subsection 1, the department shall disburse to 16 the following entities, the following amounts, for the purposes 17 designated: 18 a. To a youth-serving nonprofit organization that has been 19 in existence for at least forty-five years that provides crisis 20 stabilization, emergency shelter, and residential addiction 21 treatment, and that is located in a central Iowa county with 22 a population between ninety-eight thousand and ninety-nine 23 thousand based on the 2020 federal decennial census, to support 24 the development of a recovery-focused high school and workforce 25 training center that integrates education, job training, and 26 therapeutic support to empower youth in recovery from substance 27 use disorder to successfully transition into the workforce upon 28 graduation: 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,000,000 30 b. To an opioid treatment program incorporated as a 31 nonprofit organization in 1997, that operates fourteen 32 locations and offers behavioral and medical health care 33 to patients, and that is licensed in the state to provide 34 medication-assisted treatment, mental health therapy, 35 -4- HF 1038 (3) 91 lh/ko/md 4/ 8

H.F. 1038 counseling, and primary health care, to expand access to 1 medication-assisted treatment in rural and underserved areas 2 of the state through co-located and mobile recovery units 3 and to collaborate with jail-based screening, assessment, 4 diagnosis, and treatment service providers to extend support 5 to incarcerated individuals and individuals who are no longer 6 incarcerated, and sustain established infrastructure for 7 dispensing medications for opioid use disorder services in 8 rural and underserved areas: 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,000,000 10 c. To the administrative services organization designated 11 pursuant to section 225A.4, as enacted in 2024 Iowa Acts, 12 ch. 1161, §4, to contract with a collaborative mental health 13 services organization that operates in Iowa to provide 14 jail-based screening, assessment, diagnosis, and treatment 15 service providers and system navigation to all county jails, to 16 ensure inmates receive necessary mental health and substance 17 use care, regardless of the mental health and substance use 18 resources available in the county in which the inmate is 19 incarcerated: 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,500,000 21 d. To a nonprofit organization headquartered in a western 22 Iowa county with a population between one hundred thousand and 23 one hundred six thousand based on the 2020 federal decennial 24 census, for a recovery project that involves recovery housing 25 and post-treatment support based on a recovery cafe model, for 26 individuals in addiction recovery including those experiencing 27 homelessness and transitioning from incarceration, and the 28 nonprofit organization provides an appropriate physical 29 location and a dollar-for-dollar match for each dollar 30 disbursed to the nonprofit organization: 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,000,000 32 e. To the administrative services organization designated 33 pursuant to section 255A.4, as enacted in 2024 Iowa Acts, ch. 34 1161, §4, to contract with local peer-recovery specialists in 35 -5- HF 1038 (3) 91 lh/ko/md 5/ 8

H.F. 1038 four rural locations in the state to provide post-overdose 1 response services through emergency departments that connect 2 individuals and families to post-overdose treatment and 3 recovery support, and to train peer recovery coaches using the 4 linkage to outreach referrals and engagement model: 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,000,000 6 f. To provide grants to nonprofit organizations for each 7 nonprofit organization to establish recovery community centers, 8 including for the purchase or lease of physical space and 9 programming, in behavioral health districts four, five, and 10 seven to connect members of the recovery community to support, 11 education, resources, and advocacy: 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,500,000 13 g. To provide grants to nonprofit organizations to 14 establish recovery cafes in behavioral health districts 15 five and seven to support members of the recovery community, 16 focusing on health maintenance and opioid addiction prevention 17 by providing a safe environment to cultivate meaningful 18 connections, compassionate understanding, and a culture of 19 affirmation that enhances well-being and self-worth: 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,500,000 21 h. To provide grants to nonprofit organizations in 22 behavioral health districts one, four, five, and seven 23 for recovery respite that focuses on women, and women with 24 children, who are in substance use disorder treatment or 25 recovery to provide the women appropriate resources to enhance 26 their recovery efforts and transition to independent living: 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,500,000 28 i. To provide a grant to a nonprofit organization 29 headquartered in a city with a population between twenty-four 30 thousand five hundred and twenty-five thousand based on the 31 2020 federal decennial census, that is a member of the Iowa 32 substance use and problem gambling services integrated provider 33 network and that specializes in treatment and prevention 34 services, including outpatient, residential treatment, and 35 -6- HF 1038 (3) 91 lh/ko/md 6/ 8

H.F. 1038 detoxification for adolescents and adults who are experiencing 1 mental health and substance use disorders: 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,000,000 3 j. To provide a grant to a nonprofit organization 4 headquartered in a county with a population between one hundred 5 seventy-four thousand and one hundred seventy-five thousand 6 based on the 2020 federal decennial census, that is a community 7 mental health center under chapter 230A, and that maintains 8 or conducts a program licensed under chapter 125 the primary 9 purpose of which is the treatment and rehabilitation of persons 10 with a substance use disorder, including outpatient care, 11 residential care, habilitation homes, crisis stabilization 12 residential services, assertive community treatment, 13 multisystemic therapy, and integrated home health and 14 supportive and affordable housing for adolescents and adults 15 experiencing substance use or mental health disorders: 16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,000,000 17 3. Notwithstanding any provision of law to the contrary, of 18 the moneys appropriated to the department of health and human 19 services under subsection 1, $3,000,000 shall be disbursed as 20 grants to nonprofit organizations that submit a proposal to 21 the department of health and human services for development of 22 recovery housing in behavioral health districts that do not 23 have established recovery housing capacity. 24 4. a. Moneys disbursed under subsections 2 and 3 shall be 25 used by the recipient in compliance with the requirements of 26 the national opioid settlement agreements and section 12.51. 27 b. A recipient shall utilize the indicators and outcomes 28 identified by the department of health and human services 29 and the office of the attorney general under section 12.51, 30 subsection 2, paragraph “b”, subparagraph (3), subparagraph 31 division (c), to determine whether the services and activities 32 that are funded by the disbursement achieve the intended 33 outcomes, and shall report the recipient’s findings to the 34 department of health and human services and the office of the 35 -7- HF 1038 (3) 91 lh/ko/md 7/ 8

H.F. 1038 attorney general. 1 c. Moneys disbursed under subsection 2 shall be fully 2 obligated by the recipient no later than June 30, 2027. 3 d. A recipient shall receive no more than one disbursement 4 under subsections 2 and 3. 5 Sec. 3. EFFECTIVE DATE. This division of this Act, being 6 deemed of immediate importance, takes effect upon enactment. 7 Sec. 4. RETROACTIVE APPLICABILITY. This division of this 8 Act applies retroactively to July 1, 2024. 9 -8- HF 1038 (3) 91 lh/ko/md 8/ 8