Legislature(2001 - 2002)

03/13/2001 04:02 PM HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 130-C.O.P.S FOR API DEMOLITION/CONSTRUCTION                                                                                
The committee's attention  was turned to HOUSE BILL  NO. 130, "An                                                               
Act relating to the issuance  of certificates of participation to                                                               
finance demolition of all or  part of the existing facility known                                                               
as the  Alaska Psychiatric  Institute and  construction of  a new                                                               
facility to be known as  the Alaska Psychiatric Institute; giving                                                               
notice  of and  approving the  entry  into, and  the issuance  of                                                               
certificates of participation in,  a lease-purchase agreement for                                                               
demolition of all  or part of the existing facility  known as the                                                               
Alaska Psychiatric  Institute and construction of  a new facility                                                               
to be  known as the  Alaska Psychiatric Institute;  and providing                                                               
for an effective date."                                                                                                         
Number 1431                                                                                                                     
RANDALL  BURNS,  Director,  Alaska Psychiatric  Institute  (API),                                                               
Division   of  Mental   Health   &  Developmental   Disabilities,                                                               
Department  of Health  & Social  Services (DHSS),  came forth  to                                                               
testify on HB  130.  He stated  that the problem is  that API has                                                               
reached  the end  of its  useful life.   It  contains sprayed  on                                                               
asbestos, which  has fallen  onto the  ceiling tiles  and between                                                               
the  walls.   He  said  the utilities  are  very  high [in  cost]                                                               
because  of the  inefficiencies of  the old  [mechanical support]                                                               
systems.   The roof  is in  need of repair,  with an  estimate of                                                               
$650,000  plus costs  for the  Department of  Transportation [and                                                               
Public Facilities].   He stated that another problem  is that API                                                               
doesn't meet seismic codes.   Furthermore, it was not designed as                                                               
a hospital, and  its physical layout is not  conducive to patient                                                               
care and treatment.   It was built in 1962,  during the Cold War,                                                               
as a  [medical-surgery] hospital.   He added  that looking  for a                                                               
replacement  has  been a  problem  since  1988.   He  noted  that                                                               
studies have  concluded that it  would be cheaper to  construct a                                                               
new facility than to abate  the asbestos [situation] and make the                                                               
renovations necessary.  MR. Burns  said [DHSS] is very interested                                                               
in finding a resolution to these problems.                                                                                      
Number 1657                                                                                                                     
MR. BURNS explained that the  legislature in 1991, 1992, and 1993                                                               
gave a  total of $6.1  million for the  design and planning  of a                                                               
new hospital.   This was to be a $65  million, 114-bed facility -                                                               
90 beds for  civil patients and 24 beds for  forensic beds run by                                                               
the Department of Corrections.   However, he said, because Alaska                                                               
was in  a statewide recession  in 1994, an appropriation  bill of                                                               
only $22.8 million  was created, putting a limit of  72 beds.  He                                                               
stated that in 1996  API went out to bid, but  the bids that came                                                               
in were millions of dollars short  of the construction costs.  At                                                               
that point, API withdrew the project.                                                                                           
Number 1734                                                                                                                     
MR.  BURNS stated  that  [DHSS], with  the  Alaska Mental  Health                                                               
Trust Authority  (AMHTA) and the  Mental Health Board,  looked at                                                               
three options:   going ahead  with the idea of  building, looking                                                               
at purchasing,  or looking at  partnering with  another hospital.                                                               
He said that  [API] did "hook up" with  Providence [Hospital], as                                                               
one of those three options, and  spent a whole year talking about                                                               
a joint hospital.   He remarked that a basic  floor plan, budget,                                                               
and draft  report were  produced.  The  only difficulty  was that                                                               
Providence  [Hospital] wanted  to build  [the joint  facility] on                                                               
land to the east of its  existing hospital, which is owned by the                                                               
university.   He stated  that API  approached the  [AMHTA], which                                                               
offered the  possibility of doing a  land swap with its  land and                                                               
the university's.   Unfortunately, he explained,  that turned out                                                               
to  be too  complex, and  in late  1998 [API]  withdrew from  the                                                               
MR. BURNS continued,  stating that API then  looked at purchasing                                                               
a  replacement facility.    He said  Charter  [North] offered  to                                                               
build an addition  onto its hospital and sell [API]  one bed more                                                               
than half  of the facility.   Alaska Psychiatric  Institute would                                                               
then jointly operate that hospital.   By the end on 1998 [Charter                                                               
North]  offered   the  entire   hospital.     Alaska  Psychiatric                                                               
Institute,  starting   in  the  spring  of   1999,  entered  into                                                               
intensive negotiations,  which took  over a year  and a  half and                                                               
become complicated when Charter [North]  went bankrupt.  He added                                                               
that,  ultimately,  the  major drawback  was  the  neighborhood's                                                               
objection  and  Anchorage's   planning  and  zoning  commission's                                                               
unanimous findings  that it would  not approve [API's]  moving to                                                               
that  location  because there  would  be  forensic patients,  not                                                               
guilty-by-reason-of-insanity patients,  the wards are  locked and                                                               
the  patients  are there  involuntarily.    He remarked  that  in                                                               
December of last year [API] backed out of that deal.                                                                            
Number 1877                                                                                                                     
MR. BURNS  stated that the answer  is to build the  facility that                                                               
had  been  planned.   He  remarked  that  this could  happen  now                                                               
because  [AMHTA]  recently  conveyed   to  [DHSS]  certain  [API]                                                               
parcels  of  land  for  this  purpose.    [He  indicated  to  the                                                               
committee,   through  a   slide  presentation   and  accompanying                                                               
handout, the layout of parcels A, B,  C, D, and E.]  He explained                                                               
that [AMHTA] is willing to convey  to [DHSS] parcels B, C, and D,                                                               
and  wants to  develop  parcels  A and  E.    The university  and                                                               
Providence  Hospital  are  interested  in  any  land  nearby  for                                                               
CHAIR  DYSON asked  whether  the new  [facility]  would be  built                                                               
after the old one is demolished.                                                                                                
Number 1965                                                                                                                     
MR.  BURNS  answered   that  it  is  "phased."     He  continued,                                                               
explaining  that  building  [API]  on  this  parcel  makes  sense                                                               
because  it  is   zoned  for  this  use.     [Alaska  Psychiatric                                                               
Institute] is  a well-accepted institution  in this area  and the                                                               
neighborhood has actually  grown up around it.   He remarked that                                                               
[API]  is also  a  teaching hospital,  so it  makes  sense to  be                                                               
located  near Anchorage's  institution for  higher learning.   He                                                               
stated  that  [API]  needs  to  be  located  near  an  acute-care                                                               
hospital  because  many of  the  patients  need to  be  medically                                                               
cleared before they can be admitted  to [API]; also, if there are                                                               
medical emergencies,  the patients need  to get to a  hospital as                                                               
quickly as  possible.  He  said the university  community council                                                               
and  its  residents  have  been  very  supportive  of  API.    He                                                               
mentioned that the  Alaska Native Medical Center  has stated that                                                               
it has just  completed its ten-year plan and has  no intention of                                                               
building additional psychiatric beds  for its hospital; therefore                                                               
it  will be  relying on  [API] for  at least  another ten  years.                                                               
Most  important,   Mr.  Burns  said,  the   planning  and  zoning                                                               
commission,  in its  resolution turning  down [API's]  request to                                                               
relocate, said it thought [API] should stay where it is.                                                                        
MR.  BURNS  stated  that  building the  facility  that  had  been                                                               
planned  would be  done  through  certificates of  participation,                                                               
which would  fund both the  construction of the hospital  and the                                                               
demolition of "old" API.   He explained that HB 130  and SB 96 do                                                               
the following:   build the hospital that was planned  in 1996 and                                                               
reaffirmed  in 1998,  build a  hospital to  accommodate 54  to 72                                                               
beds,  and  construct  to the  additional  capacity,  given  [the                                                               
state's] current need for inpatient mental health treatment.                                                                    
Number 2090                                                                                                                     
CHAIR DYSON asked what his sense  is of the need for the forensic                                                               
MR.  BURNS answered  that  he  believes it  is  necessary to  not                                                               
proceed and complicate this project  with the question of whether                                                               
or not  the neighborhood would  accept a significant  addition of                                                               
forensic beds  to this hospital.   In the current  hospital there                                                               
are  ten beds,  but those  individuals, for  the most  part, have                                                               
just been accused of a crime  and are being evaluated as to their                                                               
competency to stand trial.  He  clarified that there is nobody in                                                               
the  hospital that  has been  found guilty.   Five  patients have                                                               
been  found not  guilty by  reason of  insanity, and  there is  a                                                               
group that  comes through the hospital  regularly for evaluations                                                               
through a court order.                                                                                                          
CHAIR DYSON asked  if those [patients] are in  secure portions of                                                               
the facility.                                                                                                                   
MR. BURNS  replied that all of  the units are locked,  but [these                                                               
patients] are in a more secure unit than any of the others.                                                                     
CHAIR DYSON asked if the neighborhood knows this.                                                                               
MR. BURNS  responded that [the  neighborhood] is used to  it, but                                                               
have  commented that  they are  concerned about  the addition  of                                                               
forensic beds.                                                                                                                  
Number 2213                                                                                                                     
CHAIR DYSON  asked if it  is advantageous  for the state  to have                                                               
the incarcerated mental health patients in a single facility.                                                                   
MR.  BURNS  replied  that  from  a mental  health  and  a  health                                                               
perspective,  a  prison  environment  is  not  conducive  to  the                                                               
treatment of mentally ill individuals.                                                                                          
Number 2270                                                                                                                     
REPRESENTATIVE   JOULE  remarked   that  major   maintenance  and                                                               
replacement   of  the   Department   of   Education  [and   Early                                                               
Development]  go  through  a  priority  listing,  particular  for                                                               
schools.   He asked Jerry  Watkins if there  is such a  thing for                                                               
public  facilities, where  by state-owned  property is  looked at                                                               
and the maintenance and replacement needs are ranked.                                                                           
JERRY  WATKINS,  Engineer/Architect, Construction  &  Operations,                                                               
Department  of Transportation  and  Public Facilities,  responded                                                               
that he thinks Representative Joule is talking about a long-                                                                    
range  plan for  public  facility renewal  and  replacement.   He                                                               
stated  that  he does  not  believe  one  exists, but  there  are                                                               
efforts going on to address that problem.                                                                                       
MR.  BURNS  continued,  stating  that  HB 130  and  SB  96  would                                                               
maintain  the gym  and the  storage beneath  it and  demolish the                                                               
rest.   He  stated  that one  of the  reasons  the demolition  is                                                               
important is  it would  open up  property for  other development.                                                               
He  said  the total  cost  is  $58,750,000 for  construction  and                                                               
demolition.   There is $22.2 million  in the bank because  of the                                                               
money remaining from the [API]  project and an appropriation from                                                               
AMHTA.   He  clarified  that  $36.5 million  is  remaining to  be                                                               
raised  through  certification  of   participation  in  a  lease-                                                               
purchase agreement.                                                                                                             
TAPE 01-27, SIDE B                                                                                                              
MR  BURNS continued,  stating that  since  there are  significant                                                               
funds,  [certifications of  participation]  would actually  lower                                                               
the  lease payments  to the  state.   He  added that  ultimately,                                                               
[DHSS] would be paying $3.7 million  annually for 15 years and at                                                               
the end of that time would own the facility.                                                                                    
Number 2325                                                                                                                     
MR.  BURNS  explained that  the  total  construction cost,  after                                                               
adding the  "change order  reserve," additional  architecture and                                                               
engineering   consultants,  administration   fees,  and   overall                                                               
contingency, is  $48 million.  He  added that there is  also cost                                                               
for  demolition   and  relocation   of  patients;   therefore,  t                                                               
deducting what  is in  the bank,  the total  cost that  [DHSS] is                                                               
financing is $36,550,000.                                                                                                       
MR. BURNS stated that in  comparison to other projects in Alaska,                                                               
API's construction  cost, at $36  million is $.5 million  per bed                                                               
and $357  a square foot.   Elmendorf's  was $1.4 million  per bed                                                               
and  $363 a  square foot;  Bassett  Army Hospital's  was $385  [a                                                               
square  foot];,  and  Alaska Native  Medical  Center's  was  $1.1                                                               
million per bed and $441 per square foot.                                                                                       
[Mr. Burns offered  a slide presentation to the  committee of the                                                               
API site layout.]                                                                                                               
Number 2247                                                                                                                     
MR. BURNS  stated that  there are two  other aspects  besides the                                                               
replacement  [of   the  "old"   API].     One  is   that  private                                                               
alternatives to API hospitalization  have been developed in order                                                               
to increase  the ability of  the private sector to  support these                                                               
patients in  the community.   The other  aspect is  improving the                                                               
quality of care at API.                                                                                                         
MR. BURNS  remarked that one  of the major problems  in Anchorage                                                               
is the  difficulty in knowing where  to bring a person  who needs                                                               
treatment.    Therefore,  [DHSS]  is  working  on  a  project  in                                                               
conjunction with  Providence Hospital, through federal  funds, to                                                               
build  a  space  accommodating  a  single point  of  entry.    He                                                               
explained   that  decisions   would  be   made  there   regarding                                                               
appropriate treatment  and then  the person would  be transferred                                                               
to another facility.                                                                                                            
Number 2127                                                                                                                     
MR. BURNS  stated that  for those reasons,  API is  still needed.                                                               
He  remarked  that  API  is  a core  service  of  government  and                                                               
provides services that  private providers cannot or  will not do.                                                               
He said patients  who exceed local private  treatment options and                                                               
people in  communities where  inpatient treatment  is nonexistent                                                               
would come to API.                                                                                                              
MR. BURNS concluded  that [DHSS is before  the committee] because                                                               
[personnel] feel  they have tried  a variety of options  but none                                                               
of them have worked.                                                                                                            
[HB 130 was held over.]                                                                                                         

Document Name Date/Time Subjects