Legislature(2023 - 2024)SENATE FINANCE 532

01/25/2023 09:00 AM Senate FINANCE

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09:02:13 AM Start
09:03:23 AM Presentation: Alaska Mental Health Trust Authority
10:06:17 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Teleconferenced --
+ Alaska Mental Health Authority TELECONFERENCED
- Steve Williams, CEO
- Anita Halterman, Board Chair
                 SENATE FINANCE COMMITTEE                                                                                       
                     January 25, 2023                                                                                           
                         9:02 a.m.                                                                                              
9:02:13 AM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair  Stedman   called  the  Senate   Finance  Committee                                                                    
meeting to order at 9:02 a.m.                                                                                                   
MEMBERS PRESENT                                                                                                               
Senator Lyman Hoffman, Co-Chair                                                                                                 
Senator Donny Olson, Co-Chair                                                                                                   
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Click Bishop                                                                                                            
Senator Jesse Kiehl                                                                                                             
Senator Kelly Merrick                                                                                                           
Senator David Wilson                                                                                                            
MEMBERS ABSENT                                                                                                                
ALSO PRESENT                                                                                                                  
Steve  Williams,  Chief  Executive  Officer,  Alaska  Mental                                                                    
Health  Trust  Authority;   Anita  Halterman,  Board  Chair,                                                                    
Alaska Mental  Health Trust Authority,  Representative Julie                                                                    
PRESENTATION: ALASKA MENTAL HEALTH TRUST AUTHORITY                                                                              
Co-Chair Stedman discussed the  agenda. He observed that the                                                                    
chair of  the Alaska  Mental Health Trust  Authority (AMHTA)                                                                    
Board was in the gallery.                                                                                                       
^PRESENTATION: ALASKA MENTAL HEALTH TRUST AUTHORITY                                                                           
9:03:23 AM                                                                                                                    
STEVE  WILLIAMS,  CHIEF  EXECUTIVE  OFFICER,  ALASKA  MENTAL                                                                    
HEALTH  TRUST AUTHORITY,  introduced  himself and  discussed                                                                    
his background. He relayed that  he had worked for the trust                                                                    
for about  17 years  and had held  his current  position for                                                                    
one year.                                                                                                                       
9:04:06 AM                                                                                                                    
ANITA  HALTERMAN, BOARD  CHAIR, ALASKA  MENTAL HEALTH  TRUST                                                                    
AUTHORITY, introduced herself and  relayed that she had been                                                                    
with the  AMHTA board  in a variety  of different  roles for                                                                    
approximately four years. She had  assumed the role of chair                                                                    
one year  previously. She asserted  that AMHTA had  a unique                                                                    
place in state government as  a funder that could also apply                                                                    
its  resources  in  a  catalytic  fashion  to  help  improve                                                                    
Alaskas  system  of care. She  listed AMHTAs   activities as                                                                    
supporting  partners,  bringing  on new  lines  of  service,                                                                    
supporting   capacity   building,   working   on   workforce                                                                    
development  issues, capital  projects, and  policy planning                                                                    
activities. She  acknowledged that AMHTA was  aware that the                                                                    
trust   was  not   meeting  the   needs  of   many  of   its                                                                    
beneficiaries.  She mentioned  challenges such  as waitlists                                                                    
and increasing costs. She noted  AMHTA was very engaged with                                                                    
partners  to   support  meaningful   change  and   a  robust                                                                    
continuum of services and support for vulnerable Alaskans.                                                                      
Ms.  Halterman  discussed  a presentation  entitled  "Senate                                                                    
Finance Committee, January 25, 2023" (copy on file).                                                                            
Co-Chair  Stedman  suggested   the  board  members  identify                                                                    
themselves when introduced.                                                                                                     
Ms. Halterman looked at slide 2, "Trustees":                                                                                    
     • Anita Halterman, Chair                                                                                                   
     • Rhonda Boyles, Vice Chair                                                                                                
    • Brent Fisher, Secretary, Finance Committee Chair                                                                          
     • Verné Boerner, Program and Planning Committee Chair                                                                      
     • John Sturgeon, Resource Management Committee Chair                                                                       
     • Kevin Fimon, Audit and Risk Committee Chair                                                                              
     • Agnes Moran, Trustee                                                                                                     
Ms. Halterman  introduced the trustees  listed on  the slide                                                                    
and noted  that Ms.  Moran would transition  to the  role of                                                                    
Program  and Planning  Committee  Chair.  She described  the                                                                    
composition of the  board. She explained that  the board was                                                                    
independent and provided  governance and fiduciary oversight                                                                    
and  direction  in  achieving  the  mission  of  the  trust.                                                                    
Trustees  were appointed  by the  governor and  confirmed by                                                                    
the legislature. She anticipated  that the legislature would                                                                    
be considering confirmation of two  of the seven trustees in                                                                    
the current year.                                                                                                               
Ms. Halterman spoke to slide 3, "Trust Beneficiaries":                                                                          
     Trust beneficiaries include Alaskans who experience:                                                                       
     • Mental illnesses                                                                                                         
     • Intellectual and/or developmental disabilities                                                                           
     • Alzheimer's disease and related dementia                                                                                 
     • Traumatic brain injuries                                                                                                 
     • Substance use disorders                                                                                                  
Ms. Halterman  commented that  many beneficiaries  fell into                                                                    
more than  one category listed  on the slide.  She explained                                                                    
that the trust supported  both youth and adult beneficiaries                                                                    
to   prioritize   individuals    whose   behavioral   health                                                                    
conditions  and developmental  disabilities  placed them  at                                                                    
risk  of  institutionalization.  The trust  also  considered                                                                    
prevention of  conditions (where possible)  to be a  part of                                                                    
the trusts mandate.                                                                                                             
Ms. Halterman referenced slide 4, "Mission of the Trust":                                                                       
     It  is  the duty  of  the  Alaska Mental  Health  Trust                                                                    
     Authority  to  provide   leadership  in  the  advocacy,                                                                    
     planning,  implementing  and  funding of  services  and                                                                    
     programs for Trust beneficiaries.                                                                                          
Ms. Halterman  relayed that working closely  with the state,                                                                    
the  trust   supported  the   development  of   a  five-year                                                                    
comprehensive  mental health  plan.  The  trust also  worked                                                                    
continuously to manage its assets  and preserve and grow the                                                                    
trusts    corpus.   The    trusts    activities   considered                                                                    
perpetuity,  while  anticipating beneficiaries   needs  into                                                                    
the future.                                                                                                                     
9:09:06 AM                                                                                                                    
Mr. Williams  turned to slide  5, "Legislative  Audit (2021)                                                                    
     Submitted   status   report   in   November   2022   to                                                                    
     Legislative Auditor                                                                                                        
     • Provided updates on recommendations in the 2021                                                                          
     Audit Report                                                                                                               
          • Commercial Real Estate                                                                                              
     • No recommended action necessary                                                                                          
Mr.  Williams   discussed  a  status  update   of  the  2021                                                                    
legislative  audit that  had been  requested  of the  trust,                                                                    
which was  a follow-up from an  audit in 2018. At  the time,                                                                    
there had  been interest and question  regarding whether the                                                                    
funding  for the  purchase of  seven commercial  real estate                                                                    
properties was appropriate. He recounted  that the trust had                                                                    
followed  through with  the  audit  recommendations made  in                                                                    
2018, with a follow-up in 2021  to check in on the status of                                                                    
the recommendations.                                                                                                            
Mr. Williams  continued that most recently,  the legislative                                                                    
auditor had requested  an update to include  a status update                                                                    
on the  2021 audit. There  had been five  recommendations in                                                                    
the audit,  and the  trust provided a  status report  to the                                                                    
legislative  auditor and  then  the  Legislative Budget  and                                                                    
Audit Committee  in December  2022. The  legislative auditor                                                                    
had recommended no  action at the time. He  thought the work                                                                    
with the auditor showed the  trusts  level of importance and                                                                    
its ability to address and its operations overall.                                                                              
Mr.  Williams  considered  slide  6,  "Financial  Position,"                                                                    
which  showed a  bar graph  of trust-invested  assets and  a                                                                    
table entitled  'Primary Trust Financial  Assets (end  of FY                                                                    
22).' He  noted that AMHTA  had historically used  the slide                                                                    
in  presentations  to   demonstrate  the  trusts   financial                                                                    
position  of the  total invested  assets of  the trust.  The                                                                    
graph represented  up to  year-end 2022.  He focused  on the                                                                    
far right of  the chart, where the green section  of the bar                                                                    
represented the corpus  of the trust, managed  by the Alaska                                                                    
Permanent  Fund   Corporation  (APFC).  The   green  portion                                                                    
represented about  $531 million.  The light blue  portion of                                                                    
the  bar  represented  the budget  reserves,  which  totaled                                                                    
around $204 million. The smaller,  darker portion of the bar                                                                    
represented the equity of the  real estate assets, which was                                                                    
roughly  $73  million.  He  cited a  total  of  around  $801                                                                    
million in total invested assets of the trust.                                                                                  
Mr.  Williams  observed  a  slight dip  in  2021  which  was                                                                    
reflective  of the  turbulent financial  times,  and then  a                                                                    
positive change.                                                                                                                
9:13:11 AM                                                                                                                    
Co-Chair Hoffman  asked Mr. Williams  about the  $71 million                                                                    
of  restricted reserves  as part  of the  $204 million  that                                                                    
were in the trusts reserves.                                                                                                    
Mr.  Williams informed  that  the  restricted reserves  were                                                                    
designated as part  of how the trusts   reserves were split.                                                                    
Some   of   the   reserves  were   unrestricted,   and   the                                                                    
unrestricted were  invested with APFC. The  formula was part                                                                    
of what was  reviewed in the audit in 2020  to make sure the                                                                    
trust  was  allocating  and   accounting  for  its  reserves                                                                    
Co-Chair  Hoffman asked  what  the  reserves were  earmarked                                                                    
Mr.  Williams relayed  that the  board set  a target  of 400                                                                    
percent of spending  for budget reserves. In  the event that                                                                    
there was  significant downturn in the  market, the reserves                                                                    
would   provide   funding   to  maintain   grantmaking   and                                                                    
operations without reductions.                                                                                                  
Co-Chair Stedman  relayed he had  met with Mr.  Williams the                                                                    
previous  day  and had  asked  him  to address  the  trusts                                                                     
portfolio  and its  ability to  handle  dips, including  the                                                                    
smoothing mechanism.                                                                                                            
Mr. Williams  displayed slide 7, "Available  Funding," which                                                                    
showed two tables. The table  on the left showed the trust's                                                                    
estimated available funding for  FY 24, which was calculated                                                                    
through four  different revenue streams. The  top showed the                                                                    
corpus, the second row was  unexpended funds from prior year                                                                    
grants,  the   third  row   down  showed   spendable  income                                                                    
generated by the trust land  office, and the last row showed                                                                    
interest  earned on  General Fund  and Other  Non-Segregated                                                                    
Investments (GeFONSI) accounts. He  explained that the trust                                                                    
considered  the previous  four years  for  each category  of                                                                    
funding, after which the figures  were averaged to determine                                                                    
projected available spending for the upcoming fiscal year.                                                                      
Mr. Williams continued that the  trust looked at the average                                                                    
earnings of  the corpus over  four years for a  4.25 percent                                                                    
draw. He explained that the  averaging or smoothing was done                                                                    
in order to  mitigate the highs and lows of  the market. The                                                                    
approach  was  to  smooth  out any  volatility,  so  it  had                                                                    
minimal impact on the organization and its beneficiaries.                                                                       
Mr. Williams addressed  the chart on the  right-hand side of                                                                    
the slide,  which showed available funding  each fiscal year                                                                    
since FY 19. He observed  modest growth in available funding                                                                    
of $1 million  to $2 million per fiscal year.  He noted that                                                                    
looking  at FY  23,  there  was a  modest  growth  of a  few                                                                    
hundred thousand dollars because of the current market.                                                                         
9:17:41 AM                                                                                                                    
Senator  Wilson observed  that  the  carry-forward of  prior                                                                    
year funds was  a little more than 10 percent  of the grants                                                                    
that were  funded. He asked if  there was a reason  that the                                                                    
grants were not funded. He asked for more detail.                                                                               
Mr. Williams  did not have  specific grants to  identify but                                                                    
spoke  to  why  there  was   lapses  in  grant  funding.  He                                                                    
explained  that some  projects did  not  start as  expected.                                                                    
Some work  with agencies  did not  fully expend  trust funds                                                                    
due to a variety of delays,  and some projects did not start                                                                    
at all. He  relayed that the trust tried to  keep the carry-                                                                    
forward amount below 10 percent,  but recognized that in any                                                                    
given  fiscal  year, there  would  be  funds that  were  not                                                                    
expended as hoped.                                                                                                              
Senator  Kiehl asked  Mr. Williams  to  discuss land  office                                                                    
spendable  income.  He asked  if  the  spendable income  was                                                                    
everything  generated by  the land  office, or  if it  was a                                                                    
Mr. Williams  relayed that  the purpose  of the  land office                                                                    
was to  maximize revenue  on trust lands  to the  benefit of                                                                    
beneficiaries and the trust. When  the land office generated                                                                    
revenue for  the trust,  it was  broken into  two categories                                                                    
per statute  and regulation. Some  of the  revenue generated                                                                    
from trust  lands was spendable  income and did not  have to                                                                    
go into  the corpus or  principal, and some revenues  had to                                                                    
be  deposited in  the corpus  of the  trust per  statute. He                                                                    
cited  that  85 percent  of  revenue  generated from  timber                                                                    
activity  on trust  lands  went into  the  principal of  the                                                                    
trust,  and  15 percent  was  distributed  to the  trust  as                                                                    
spendable  income.  He  noted  that  land  office  spendable                                                                    
income was  part of  the table  on slide  7 that  showed the                                                                    
trusts estimated available funding for FY 24.                                                                                   
9:20:29 AM                                                                                                                    
Mr. Williams highlighted slide 8, "FY 24 Spending":                                                                             
     Authority Grants                                                                                                           
     Designated grants to community providers, nonprofits,                                                                      
     local governments and Tribal organizations                                                                                 
     •Includes $1.9M in mini grants                                                                                             
     Agency Budgets                                                                                                             
     Trust Authority: $4,624.4                                                                                                  
     Trust Land Office: $5,019.1                                                                                                
     Designated grants to state agencies, requires receipt                                                                      
Mr.  Williams  discussed  the  pie  chart  on  slide  8.  He                                                                    
explained  that  the  trust   authority  office  focused  on                                                                    
programs,  services, grants,  and  policy  making. He  cited                                                                    
that  there  were  17  full-time   employees  in  the  trust                                                                    
authority office. The trust land  office was operated within                                                                    
the  Department  of  Natural Resources,  separate  from  the                                                                    
trust authority  office in the Department  of Revenue. There                                                                    
were 19  full time  employees in the  land office.  The land                                                                    
office  monitored   and  developed  the  land   so  that  it                                                                    
maintained   value    and   provided    revenue   generating                                                                    
Mr. Williams  discussed the yellow  slice of the  pie chart,                                                                    
Mental Health Trust  Authority Authorized Receipts (MHTAAR),                                                                    
which were  funds approved  by the  trustees for  a specific                                                                    
purpose  within  a  state  agency.  He  explained  that  the                                                                    
legislature provided the receipt  authority to use the funds                                                                    
as approved by  the trustees. He cited that in  FY 24, there                                                                    
was  about  $9.8  million  going   to  a  variety  of  state                                                                    
agencies. The dark  green half of the pie  was indicative of                                                                    
authority  grants   that  went  outside  the   state  budget                                                                    
process.  The  trust  had  the   authority  to  make  grants                                                                    
directly to organizations.                                                                                                      
Mr. Williams  noted that  the mini  grants mentioned  on the                                                                    
slide  went  directly  to beneficiaries  for  a  variety  of                                                                    
reasons. He described that trustees could apply for mini-                                                                       
grants  of up  to $2,500  for mental  health and  addiction-                                                                    
related  issues,  for populations  experiencing  Alzheimer's                                                                    
and dementia and other related  disorders, and for those who                                                                    
might   experience   an    intellectual   or   developmental                                                                    
Co-Chair  Stedman   asked  Mr.   Williams  to   avoid  using                                                                    
acronyms. He asked for an explanation of FTE.                                                                                   
Mr.  Williams  explained  that  FTE  signified  a  full-time                                                                    
equivalent position.                                                                                                            
Mr. Williams looked at slide 9, "MHTAAR, FY24":                                                                                 
      Dept. of Health ($3,384.8)                                                                                             
      UAA ($2,092.5)                                                                                                         
      AHFC ($1,520.0)                                                                                                        
      Dept. of Family and Community Services ($772.0)                                                                        
      Dept. of Corrections ($771.0)                                                                                          
      Dept. of Administration ($353.4)                                                                                       
      Alaska Court System ($304.4)                                                                                           
      Dept. of Transportation and Public Facilities                                                                          
      Dept. of Public Safety ($160.0)                                                                                        
      Dept. of Education and Early Development ($120.0)                                                                      
      Dept. of Labor and Workforce Development ($25.0)                                                                       
Mr. Williams  summarized that there  was about  $9.8 million                                                                    
approved  by  the  trustees  and   going  through  11  state                                                                    
agencies. The  combined total for  the Department  of Health                                                                    
and  the Department  of Family  and  Community Services  was                                                                    
about $4 million.  There were also increments  to the Alaska                                                                    
Court System and AHFC.                                                                                                          
9:25:13 AM                                                                                                                    
Mr.   Williams   addressed   slide    10,   "FY   24   GF/MH                                                                    
Recommendations  (and Associated  MHTAAR),"  which showed  a                                                                    
table  comparing   what  had  been  approved   with  trustee                                                                    
recommendations and  what was in the  governor's proposed FY                                                                    
24   budget  that   had  been   released  in   December.  He                                                                    
highlighted  that every  year by  statute  AMHTAs  board  of                                                                    
trustees had  to made recommendations to  the administration                                                                    
and  the legislature  for how  the state  could spend  state                                                                    
General Fund dollars. The trust  submitted a letter with the                                                                    
approved  budget by  September 15.  He referenced  the table                                                                    
and noted  that the blue  columns denoted what  the trustees                                                                    
recommended, and the  yellow columns showed what  was in the                                                                    
governors proposed budget.                                                                                                      
Mr. Williams continued to address  slide 10. The top portion                                                                    
of the  table showed operating  budget items and  the bottom                                                                    
portion showed capital budget items,  which were included in                                                                    
the mental  health budget.  He noted  that the  governor did                                                                    
include several recommendations from  the trustees for state                                                                    
General Funding,  but did  not include  all recommendations,                                                                    
which was  not uncommon.  He noted that  the recommendations                                                                    
were  the  priorities of  the  trust  to ensure  there  were                                                                    
services and  programs in the communities.  He mentioned the                                                                    
Crisis Now  Continuum of  Care grants,  which were  shown on                                                                    
two lines  of the table  as recommendations by the  trust in                                                                    
the amounts  of $1  million and  $500,000. He  described the                                                                    
grants as  critical for the  trusts  continued  momentum and                                                                    
implementation  of  the  Crisis Now  statewide  effort,  but                                                                    
noted  that  the   items  had  not  been   included  in  the                                                                    
governors proposed budget.                                                                                                      
Mr. Williams mentioned  the Comprehensive Integrative Mental                                                                    
Health Program  Plan, which was  a plan that by  statute was                                                                    
developed every five years by  the department in partnership                                                                    
with  the trust  and others.  The plan  was approaching  its                                                                    
renewal period,  and the increment  shown in the  second row                                                                    
of  the   table  reflected   the  associated   position.  He                                                                    
emphasized that  the increment shown  in the second  row was                                                                    
critical for the  trust to have a point of  contact with the                                                                    
department for developing and updating the plan.                                                                                
Co-Chair Stedman wanted to wait  to address the matter until                                                                    
the  administration submitted  the  supplemental budget  and                                                                    
amendments that were expected in  the following week, before                                                                    
a   discussion   to    further   understand   concerns   and                                                                    
recommendations. He mentioned  the Alaska Housing Assistance                                                                    
Program  and  committee  interest in  concentrating  on  the                                                                    
housing shortage and  capacity issues. He was  sure that the                                                                    
capital budget  chairman would be  interested in  the matter                                                                    
and thought  the committee would  seek out  discussions with                                                                    
the  administration  and  the trust  to  see  about  further                                                                    
increasing  housing  availability.   He  mentioned  problems                                                                    
throughout the state, particularly in rural Alaska.                                                                             
9:29:27 AM                                                                                                                    
Senator   Wilson  had   a   question   about  peer   support                                                                    
certification in the  Department of Health. He  asked if the                                                                    
funds  were for  substance abuse  peer support.  He did  not                                                                    
think  there  was  a  requirement for  peer  support  to  be                                                                    
certified. He  asked if there was  associated legislation or                                                                    
if  the  trust was  offering  certification  for those  that                                                                    
wanted it.                                                                                                                      
Mr.  Williams   relayed  that  there  was   a  peer  support                                                                    
certification  program   developed  by  the   department  in                                                                    
conjunction with  the trust  whereby programs  could utilize                                                                    
people with lived experience in  the delivery of services in                                                                    
the system of care. He offered  to get back to the committee                                                                    
with  information  on  whether  there  was  a  certification                                                                    
requirement. He  added that peer certification  was an entry                                                                    
point and pathway to  increased employment opportunities for                                                                    
individuals  who had  lived experiences.  He mentioned  that                                                                    
peer  support  was  a  key  component  of  the  delivery  of                                                                    
services  in all  the  levels  of the  Crisis  Now model  of                                                                    
continuum of care.                                                                                                              
9:31:11 AM                                                                                                                    
Senator   Wilson   qualified    that   he   supported   peer                                                                    
certification but  did not know  if it was required  as part                                                                    
of  the  different billable  systems.  He  wanted to  ensure                                                                    
there were qualified individuals.                                                                                               
Mr.  Williams agreed  to  follow up  with  the committee  in                                                                    
Co-Chair Stedman mentioned the topic  of the budgets and the                                                                    
fiscal position of mental  health. He recounted conversation                                                                    
from  a few  years previously  about inflation-proofing  the                                                                    
trust. He asked Mr. Williams to address the topic.                                                                              
Mr.  Williams discussed  inflation  proofing and  emphasized                                                                    
protecting  the purchasing  power  of the  trust for  future                                                                    
beneficiaries. He  shared that  it was possible  to transfer                                                                    
income into  the principal of  the trust as a  mechanism for                                                                    
doing so,  and in  the past  couple of  years the  trust had                                                                    
done so  with approximately $76 million.  He reiterated that                                                                    
the trust  calculated available spending by  ensuring it did                                                                    
not overdraw and  by using the average of  the previous four                                                                    
years of  earnings with a  4.25 percent draw. He  cited that                                                                    
the  trust had  contracted with  Callan the  past spring  to                                                                    
look  out   the  inflation-proofing  approach.   Callan  had                                                                    
concurred  with the  approach that  the board  was using  to                                                                    
protect and inflation-proof the corpus.                                                                                         
Co-Chair Stedman asked if  the inflation-proofing was taking                                                                    
place on more of a routine basis than previously.                                                                               
Mr. Williams  answered  yes.  He  mentioned the  400 percent                                                                    
target for  budget reserves, after which  the trustees could                                                                    
take  any  excess  for inflation-proofing  or  any  critical                                                                    
programing  or  anything related  to  the  land office.  The                                                                    
revenue  beyond the  400  percent  triggered a  conversation                                                                    
with trustees as to how to deploy the funding.                                                                                  
Co-Chair  Stedman  asked Mr.  Williams  to  discuss why  the                                                                    
trust was  so protective  of the fund  and why  the spending                                                                    
amount was capped at 4.25 percent.                                                                                              
Mr.   Williams  mentioned   the  role   of  the   trust  and                                                                    
beneficiaries   and   mentioned  maintaining   funding   and                                                                    
purchasing  power to  maintain equity  between beneficiaries                                                                    
today and beneficiaries in the future.                                                                                          
Co-Chair  Stedman  asked  if  it  was  critical  in  AMHTAs                                                                     
mission to not overdraw the trust.                                                                                              
Mr. Williams answered "yes."                                                                                                    
Co-Chair   Stedman  thought   it   would   be  helpful   for                                                                    
presentation in the other body,  which had many new members,                                                                    
to explain the philosophy behind the 4.25 percent draw.                                                                         
Mr. Williams  thanked Co-Chair  Stedman for  his suggestion.                                                                    
He noted  that Callan  had reviewed  the trust  the previous                                                                    
spring  and concurred  that the  4.25 percent  draw was  the                                                                    
appropriate   percentage   to   maintain  the   equity   and                                                                    
purchasing power for the future.                                                                                                
9:36:28 AM                                                                                                                    
Mr. Williams  advanced to slide  11, "Trust  Grant Impacts,"                                                                    
which was a high-level demonstration  of grant impact for FY                                                                    
22. He referenced  the AMHTA annual report,  and an included                                                                    
investment   report  which   was  distributed   to  members                                                                     
offices.  He noted  that the  investment report  listed each                                                                    
grant awarded  by the trust in  FY 22. The slide  showed the                                                                    
categories  and types  of grants  and the  total amounts  of                                                                    
funds approved for the different projects and purposes.                                                                         
Co-Chair Stedman  thought Senator  Bishop would like  to ask                                                                    
about workforce development.                                                                                                    
Senator  Bishop asked  what AMHTA  was doing  with workforce                                                                    
development and training.                                                                                                       
Mr. Williams relayed  that the trust was  engaged in several                                                                    
different  areas   related  to  workforce   development.  He                                                                    
referenced  Senator  Wilson's  question about  peer  support                                                                    
certification, which  was an area  the trust was  engaged in                                                                    
to build  up the workforce  for providers. He  mentioned the                                                                    
Support  for Service  to Health  Care Practitioners  (SHARP)                                                                    
Program,  which  was  a  loan  repayment  program  that  had                                                                    
generated  hundreds  of  jobs  included  nurses,  behavioral                                                                    
health clinicians  and behavioral  health aids.  The program                                                                    
had been tapped  into by the Department  of Corrections, the                                                                    
Alaska  Psychiatric Association,  the  Office of  Childrens                                                                     
Services, as well as community partners.                                                                                        
Senator  Bishop  asked  whether  Alzheimer's  patients  fell                                                                    
under  the purview  of  the trust.  He had  seen  a need  to                                                                    
expand  training in  the care  of  Alzheimers  patients.  He                                                                    
thought  the  state might  be  behind  the curve  in  having                                                                    
services in the community.                                                                                                      
Mr. Williams affirmed  that adults experiencing Alzheimer's,                                                                    
dementia, or  other related illnesses were  beneficiaries of                                                                    
the  trust. The  trust  did its  work  to address  workforce                                                                    
issues  and   solutions  in  partnership  with   the  Alaska                                                                    
Commission  on  Aging, which  was  one  of trusts   advisory                                                                    
boards. He offered to  provide further information regarding                                                                    
any  potential  grants  over time  with  targeted  workforce                                                                    
related to the population mentioned by Senator Bishop.                                                                          
Senator  Wilson  asked  for  clarification  of  the  state's                                                                    
utilization of  state programs using the  SHARP Program, and                                                                    
whether it was SHARP I, II, or III.                                                                                             
Mr. Williams  agreed to get  back to the committee  with the                                                                    
Co-Chair  Stedman  asked  Senator   Wilson  to  restate  the                                                                    
Senator Wilson defined the SHARP acronym.                                                                                       
Mr. Willams explained that over  the course of several years                                                                    
the   SHARP  program   had   gone   through  evolutions   of                                                                    
improvement  and  different  programs related  to  workforce                                                                    
issues.  He offered  to provide  detailed  information at  a                                                                    
later time.                                                                                                                     
9:41:04 AM                                                                                                                    
Mr. Williams looked at slide 12:                                                                                                
     The Trust develops its budget and engages in                                                                               
     grantmaking, advocacy, and system improvement efforts                                                                      
     around the following areas:                                                                                                
     Established Focus Areas                                                                                                    
      Disability Justice                                                                                                        
      Mental Health & Addiction Intervention                                                                                    
      Beneficiary Employment & Engagement                                                                                       
      Housing and Home & Community Based Services                                                                               
     Additional Priorities                                                                                                      
      Workforce Development                                                                                                     
      Early Childhood Intervention & Prevention                                                                                 
Mr.  Williams explained  that  when  staff presented  budget                                                                    
recommendations to  the AMHTA Board  of Trustees,  there was                                                                    
direction by  the trustees to  do so in a  targeted fashion.                                                                    
He discussed the  focus areas listed on the  slide and noted                                                                    
that the  strategies and  goals within  the focus  areas had                                                                    
changed  over  time.  The  focus   areas  were  issues  that                                                                    
impacted beneficiaries  and required long-term  and constant                                                                    
improvement. He  expressed that  the value  of the  trust to                                                                    
the state  was that  it used  its funds  to help  the system                                                                    
continue to  evolve over time  so as to not  become stagnant                                                                    
in  quality  or  efficiency.  He explained  that  the  trust                                                                    
looked at areas within each of the focus areas listed.                                                                          
Mr. Williams showed slide 13, "Policy/Advocacy":                                                                                
     •Community-Based Services                                                                                                  
     •Housing and homelessness                                                                                                  
     •Workforce Development                                                                                                     
     •Transforming behavioral health crisis response                                                                            
Mr. Williams noted that in  addition to the focus areas, the                                                                    
trust   was  engaged   in  policy   and  advocacy   work  in                                                                    
partnership  with its  four statutory  advisors: the  Alaska                                                                    
Commission  on Aging,  the Alaska  Mental Health  Board, the                                                                    
Advisory Board on Alcoholism and  Drug Abuse, as well as the                                                                    
Governors   Council on  Special Education  and Disabilities.                                                                    
He  noted that  although  the areas  were  broad, they  were                                                                    
critical to the way the  trusts  system provided services to                                                                    
its  beneficiaries   and  families  across  the   state.  He                                                                    
emphasized that  having access to  families as close  to the                                                                    
home as possible  was the most cost  effective and effective                                                                    
way of meeting the needs of the beneficiaries.                                                                                  
Mr.  Williams continued  discussing AMHTAs   focus areas  of                                                                    
policy   and   advocacy.   He   mentioned   that   workforce                                                                    
development was  critical to  the trusts   organizations and                                                                    
mentioned the  struggle with  workforce across  all sectors.                                                                    
He highlighted that  healthcare was one of  the largest cost                                                                    
drivers  in the  state.  He cited  that trust  beneficiaries                                                                    
were largely  insured through the Medicaid  Program, and the                                                                    
trusts   organizations used  Medicaid to  bill for  services                                                                    
while ensuring  the billed  services were  commensurate with                                                                    
the cost of delivery.  The organizations also maintained the                                                                    
relevance to  inflation over  time. He  noted that  the last                                                                    
bullet referenced  the trusts  work with  the department and                                                                    
others in the community on the Crisis Now system of care.                                                                       
Mr. Williams referenced slide  14, "Behavioral Health Crisis                                                                    
Response: Timeline,"  which showed a flow  chart depicting a                                                                    
timeline  to show  the work  with the  department and  other                                                                    
partners in  transforming how the state  responded to people                                                                    
having a  behavioral health crisis.  He mentioned  a lawsuit                                                                    
against  the state  in 2018  or 2019,  which was  the energy                                                                    
behind  the  department and  the  trust  considering how  to                                                                    
transform the system.                                                                                                           
9:46:00 AM                                                                                                                    
Mr. Williams turned to slide  15, "Crisis Now Implementation                                                                    
-At a Glance":                                                                                                                  
      System Implementation                                                                                                     
     •House Bill 172 signed into law in July 2022                                                                               
     •988 implemented nationwide in July 2022                                                                                   
     •Medicaid 1115 waiver implementation ongoing                                                                               
     •Statewide   Hospital    ERs   Learning   Collaborative                                                                    
     established in December 2022                                                                                               
     • Crisis Now Project Management Contract                                                                                   
     • Careline Crisis Line                                                                                                     
     •Crisis Community Coordinator                                                                                              
     •Mobile Crisis Response + Withdrawal Management                                                                            
     •Crisis Community Collaborative                                                                                            
     •Crisis Community Coordinator                                                                                              
     •Crisis Stabilization Planning Grants: Southcentral                                                                        
     Foundation, Providence Alaska                                                                                              
     •Crisis Community Collaborative                                                                                            
     •Crisis Community Coordinator                                                                                              
     •Mobile Crisis Response                                                                                                    
     •Crisis Community Collaborative                                                                                            
     •Bartlett Regional Crisis Stabilization                                                                                    
     •Mobile Integrated Behavioral Health Response                                                                              
     •Crisis Community Collaborative                                                                                            
     •Crisis Community Coordinator                                                                                              
     Early Planning Efforts                                                                                                     
     •Copper Center                                                                                                             
Mr. Williams  thanked the members  for their support  for HB
172 [legislation passed  in 2022 that dealt  with changes to                                                                    
involuntary  commitment]  the  previous year,  which  was  a                                                                    
strong and  required underpinning  for the Crisis  Now model                                                                    
implementation  would  be  successful.  He  cited  focus  on                                                                    
Anchorage,  Fairbanks,  and the  Matanuska-Susitna  (Mat-Su)                                                                    
Valley;  but noted  that  the map  indicated  work in  other                                                                    
communities  including  Kotzebue, Copper  Center,  Unalaska,                                                                    
Juneau, and Ketchikan.                                                                                                          
Senator  Wilson recalled  that the  previous year's  capital                                                                    
budget had provided $8 million  to Providence Medical Center                                                                    
to help with the Crisis Now  model and remodel of the Alaska                                                                    
Psychiatric  Institute (API).  Since that  time, he  thought                                                                    
Providence  had switched  the  chief  executive officer  and                                                                    
made other changes and was rumored  to not be engaged in the                                                                    
project  as  planned.  He  asked if  Mr.  Williams  had  any                                                                    
concerns about the project staying  on track, or whether the                                                                    
funds needed  to be  redirected to  other facilities  in the                                                                    
state  that  could  be  converted  to  crisis  stabilization                                                                    
Mr. Williams affirmed that the  matter had been discussed in                                                                    
conversations   immediately   after   the   transition   had                                                                    
happened.  The trust  did not  have any  concerns about  the                                                                    
project going forward. The old  API building was intended to                                                                    
be  a crisis  stabilization center.  The building  would not                                                                    
only provide crisis stabilization  services, but also crisis                                                                    
residential  services and  an urgent  care component.  There                                                                    
had been no indications that  the plan would not go forward,                                                                    
and  the  trust  had  recently   viewed  a  presentation  by                                                                    
Providence  on  the  current  project  with  a  request  for                                                                    
additional  funds   to  continue.  He  recounted   that  the                                                                    
trustees only  yesterday had  approved roughly  $1.5 million                                                                    
for Providence to continue the work on the project.                                                                             
Senator Bishop asked  for more information on  who the trust                                                                    
was working with for providers  in the Copper Valley area of                                                                    
his district.                                                                                                                   
Mr. Williams  agreed to provide  the information at  a later                                                                    
9:49:44 AM                                                                                                                    
Mr. Williams considered slide 16, "Trust Land Office":                                                                          
     •Land sales                                                                                                                
     •Revenues from USFS Land Exchange parcels                                                                                  
     •Icy Cape development                                                                                                      
     •Easement program                                                                                                          
Mr. Williams noted  that the executive director  of the land                                                                    
office, along with 18 positions,  helped to generate revenue                                                                    
off of lands for the trust.  He highlighted the table on the                                                                    
right-hand  side  of  the  slide,  which  showed  the  asset                                                                    
classes of  trust lands. The  items showed some of  the ways                                                                    
the  trust  land  office  generated  revenue.  He  mentioned                                                                    
mineral  development, timber,  leases, land  sales, and  the                                                                    
sale   of  materials   such  as   gravel.  He   pointed  out                                                                    
anticipated  revenue   of  $11.8  million  for   FY  23.  He                                                                    
highlighted land  sales. He noted  that each fall  the trust                                                                    
office  had a  land  sale, where  individual Alaskans  could                                                                    
place bids for  identified parcels of land.  The most recent                                                                    
land sale had  generated $2.7 million of  revenue, and based                                                                    
on the amount he thought the  trust would meet or exceed its                                                                    
goals for the current fiscal year.                                                                                              
Mr. Williams continued to discuss  the trust land office. In                                                                    
addition to revenues from the  land exchange and parcels the                                                                    
trust  continued  to  have  timber  activity.  He  mentioned                                                                    
locations in  Naukati, Prince of  Wales Island,  and Shelter                                                                    
Cove. The  timber activity generated  income for  the trust.                                                                    
He  added that  the activity  maintained a  workforce in  an                                                                    
area of the state. He  discussed the Icy Cape development, a                                                                    
parcel of  land which  was near Yakutat,  where there  was a                                                                    
possibility  of   generating  revenue  from   minerals.  The                                                                    
project was  working towards a pre-feasibility  study of the                                                                    
parcel. He described that the  trust was looking at possible                                                                    
revenue generation from utility easements.                                                                                      
9:53:02 AM                                                                                                                    
Co-Chair  Stedman  corrected  that  Icy Cape  was  north  of                                                                    
Yakutat. He  mentioned that the  Naukati area was  on Prince                                                                    
of Wales Island, and Shelter Cove was in Ketchikan.                                                                             
Senator Wilson referenced  discussions by the administration                                                                    
regarding  carbon sequestration  and wondered  if the  trust                                                                    
land  office  had started  looking  at  the issue  since  it                                                                    
engaged in timber sales.                                                                                                        
Mr.  Williams  affirmed that  the  topic  was a  subject  of                                                                    
conversation that  the trust land  office was  looking into,                                                                    
with consideration  of how  it could  play into  the trusts                                                                     
work and lands.                                                                                                                 
Senator Bishop  asked how many  acres the trust  land office                                                                    
had sold to generate $2.7 million.  He asked if the Icy Cape                                                                    
development was a placer deposit.                                                                                               
Mr.  Williams acknowledged  that  he was  not  an expert  in                                                                    
mining  terminology but  thought the  term placer  indicated                                                                    
the use  of water to  wash out  minerals from the  area, and                                                                    
indicated yes.                                                                                                                  
Co-Chair Stedman thought there would  be a project visit the                                                                    
following summer and thought there  was a substantial amount                                                                    
of mineralization that could be  lucrative for the trust. He                                                                    
thought  the  potential project  was  a  promising area  for                                                                    
revenue and jobs.                                                                                                               
9:55:21 AM                                                                                                                    
Senator Kiehl asked  how much interest the board  had in the                                                                    
land office's  approach. He opined  the trust should  be the                                                                    
most popular entity in the  state but thought in many places                                                                    
the trust  was deeply  disliked due to  its approach  to the                                                                    
land offices  activities. He asked  if the board was engaged                                                                    
with the matter.                                                                                                                
Ms.  Halterman  was  aware of  conflicts  with  the  trust's                                                                    
resource development projects and  feedback from the public.                                                                    
She  did  not know  if  the  trusts   approach had  been  as                                                                    
meaningful as  it could be  with regard to the  trusts  land                                                                    
development. She  specified that the trust  needed to engage                                                                    
partners  more  frequently  and in  a  meaningful  way.  She                                                                    
relayed that the  board did the best it  could, learned from                                                                    
mistakes as  it presented development projects,  and engaged                                                                    
with  feedback.  She  emphasized  that the  board  was  very                                                                    
engaged   with   the   trusts   resource   development   and                                                                    
emphasized  the associated  income  and  jobs creation.  She                                                                    
relayed  that the  trust wanted  the communities  to support                                                                    
the  projects, and  that  the trust  needed  to ensure  that                                                                    
resource development projects were the right fit.                                                                               
Mr.  Williams added  that  he had  been  charged with  doing                                                                    
community  outreach and  education  related  to the  trust's                                                                    
role and  resources, and  how the  money that  was generated                                                                    
benefitted communities and individuals.  He thought that by-                                                                    
in-large individuals  did not  understand the  complexity of                                                                    
the trust nor  the difference between state  and trust lands                                                                    
and the trust mission.                                                                                                          
Ms.  Halterman added  that the  trust could  and would  do a                                                                    
better  job of  educating  beneficiaries about  the role  of                                                                    
resource development  for programs. She thought  there was a                                                                    
disconnect  for beneficiaries  that did  not understand  how                                                                    
trust land was different from  other lands in the state. She                                                                    
affirmed that the board and the  CEO and staff were aware of                                                                    
the  need   to  engage   beneficiaries  to   understand  the                                                                    
connection  to  resource  development. She  cited  that  the                                                                    
efforts were started  when trust land office  was present at                                                                    
the  Improving Lives  Conference.  She  summarized that  the                                                                    
board  was well  aware of  the disconnect  and was  actively                                                                    
working to improve the situation.                                                                                               
9:58:44 AM                                                                                                                    
Senator Kiehl apologized if he  had suggested that the trust                                                                    
should not  develop resources, which was  not his intention.                                                                    
He mentioned concepts such as  social license. He thought it                                                                    
was important that when communities learned about a high-                                                                       
impact development  when the work was  already underway, the                                                                    
opportunity  to  work  with   the  community  was  lost.  He                                                                    
referenced  a roughly  25-year history  of a   bad neighbor                                                                     
approach. He thought  the trust had every  opportunity to do                                                                    
all the resource development it did without making enemies.                                                                     
Ms. Halterman thought Senator Kiehl's point was well made.                                                                      
Co-Chair Stedman relayed that there  was a lot of trust land                                                                    
in  his  district,  and  the trust  had  responded  well  to                                                                    
communities  while trying  to work  the issue  if there  was                                                                    
visual  or  view-shed  impact  through  land  exchanges.  He                                                                    
discussed  monetizing trust  lands,  which  was the  trusts                                                                     
mission. He  recognized that  trust land  development caused                                                                    
great concern, especially to those  that lived next to trust                                                                    
land.  He   thought  the  trust   had  been   responsive  to                                                                    
communities and  cited that the  trust had  harvested timber                                                                    
and followed  up with subdivisions  to increase  housing. He                                                                    
recognized there  was always ongoing  conflict, particularly                                                                    
regarding  timber  harvest.  He  thought the  trust  was  in                                                                    
difficult position as a land developer.                                                                                         
10:01:31 AM                                                                                                                   
Senator  Wilson  echoed   Co-Chair  Stedman's  comments  and                                                                    
referenced  a  trust  project  in   his  district  that  had                                                                    
experienced  conflict.  He  thought   the  matter  had  been                                                                    
resolved and thanked  the trust, who he  thought had handled                                                                    
the issue responsibly.                                                                                                          
Co-Chair  Stedman relayed  that there  was potentially  huge                                                                    
view  shed  impacts  in  Ketchikan, in  an  area  where  the                                                                    
Russians  had logged  up Mount  Verstovia. He  mentioned the                                                                    
old second-growth after Russian  logging and shipbuilding in                                                                    
Sitka. He relayed that the issue  had been worked out over a                                                                    
long period  of time and worked  on a land exchange.  He was                                                                    
sure there were other areas  of concern. He mentioned Haines                                                                    
and Whale Pass.                                                                                                                 
Co-Chair  Stedman  asked  for  more  detail  regarding  real                                                                    
estate holdings  that were subject to  the legislative audit                                                                    
in 2018.  He asked  about a target  holding period  and cash                                                                    
positions of  the assets. He  wondered about the  time frame                                                                    
of when the projects would be gone.                                                                                             
Mr. Williams agreed to provide an update.                                                                                       
Mr. Williams displayed slide 17, "Thank You."                                                                                   
Mr.  Williams  appreciated   the  committees   interest  and                                                                    
dialogue and looked forward to a continued partnership.                                                                         
Co-Chair  Stedman looked  forward to  a presentation  on the                                                                    
Icy Cape  development the following year.  He suggested that                                                                    
the next  presentation could  provide information  on income                                                                    
and job creation potential.                                                                                                     
Co-Chair  Stedman discussed  the  agenda  for the  following                                                                    
10:06:17 AM                                                                                                                   
The meeting was adjourned at 10:06 a.m.                                                                                         

Document Name Date/Time Subjects
012523 AMHTA SFC Presentation.pdf SFIN 1/25/2023 9:00:00 AM
012523 Trust Responses to S FIN Committee Questions 1.31.23.pdf SFIN 1/25/2023 9:00:00 AM