2021-08-16                     House Journal                      Page 1377
HB 71                                                                                                                         
The following letter was dated June 30 and received July 2 at                                                                   
10:06 a.m.:                                                                                                                     
                                                                                                                                
"Dear Speaker Stutes:                                                                                                           
                                                                                                                                
On this date, I have signed, with line-item vetoes, the following bill                                                          
passed during the first special session of the Thirty-Second Alaska                                                             
State Legislature, and am transmitting the engrossed and enrolled                                                               
copies to the Lieutenant Governor’s Office for permanent filing:                                                                
                                                                                                                                
     CONFERENCE CS FOR HOUSE BILL NO. 71                                                                                        
     "An Act making appropriations for the operating and capital                                                                
     expenses of the state's integrated comprehensive mental health                                                             
     program; making capital appropriations and supplemental                                                                    
     appropriations; and providing for an effective date."                                                                      
                                                                                                                                
                        Chapter No. 1, FSSLA 2021                                                                              
                      [Effective Date: See Chapter]                                                                            
                                                                                                                                
The following reductions were made to the Mental Health Capital and                                                             
Operating budget. The Department of Health and Social Services                                                                  
division operations, program grants, and general administration, were                                                           
reduced by $5,991,000 in General Funds. The Department of                                                                       
Commerce, Community, and Economic Development appropriation                                                                     
for Community and Regional Affairs was reduced by $180,000 in                                                                   
General Funds. The Department of Administration, Public Defender                                                                
Agency, appropriation was reduced by $86,000. The University of                                                                 
Alaska, Anchorage campus appropriation was reduced by $325,000                                                                  
Unrestricted General Fund (UGF). Capital upgrade requests totaling                                                              
$3,150,000 UGF were also reduced.                                                                                               

2021-08-16                     House Journal                      Page 1378
The above line-item reductions were made due to the lack of a proper                                                            
source of funding. When House Bill 71 was introduced at the                                                                     
beginning of the Thirty-Second Legislature, several of the above-listed                                                         
items were proposed using funds from the Mental Health Trust Fund.                                                              
During legislative deliberations those items, and additional new                                                                
appropriations, were uniformly proposed by the Legislature to be                                                                
funded with UGF.                                                                                                                
                                                                                                                                
This is unacceptable for the following two reasons. First, the UGF is                                                           
limited and the basis of deep budgetary debates that are ongoing to                                                             
fund multiple constitutional and statutory obligations. Second, and                                                             
more importantly, the Mental Health Trust (Trust) has the financial                                                             
capabilities to sustain the programs and projects reduced with its own                                                          
funding. To date, the Mental Health Trust Fund is projected to end                                                              
Fiscal Year 2021 with $131,400,000 in reserves. After accounting for                                                            
maintaining a longstanding reserve target rate of $96,600,000, the                                                              
Trust can apply $34,800,000 in its own funding for items like those                                                             
reduced above.                                                                                                                  
                                                                                                                                
I call upon the Trust’s Board, its executive team, and the Legislature,                                                         
to deliberate on the fiscal actions the Trust has undertaken in recent                                                          
years, and whether or not those actions comport with its mission to                                                             
better the lives of Trust beneficiaries.                                                                                        
                                                                                                                                
After my vetoes, the total enacted amount of this bill is $231,365,500                                                          
comprised of $161,360,800 of UGF, $52,929,700 of Designated                                                                     
General Funds, and $17,075,000 of other funds. The funding source of                                                            
every program and project is critical to the transparency the Alaska                                                            
public demands of its government. I call on all of us to work together                                                          
to make that expectation a reality for the people of this State.                                                                
                                                                                                                                
Sincerely,                                                                                                                      
/s/                                                                                                                             
Mike Dunleavy                                                                                                                   
Governor"