Legislature(2007 - 2008)SENATE FINANCE 532
02/14/2007 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| Alaska Mental Health Trust Authority | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
MINUTES
SENATE FINANCE COMMITTEE
February 14, 2007
9:03 a.m.
CALL TO ORDER
Co-Chair Lyman Hoffman convened the meeting at approximately
9:03:20 AM.
PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Charlie Huggins, Vice Chair
Senator Kim Elton
Senator Fred Dyson
Senator Joe Thomas
Senator Donny Olson
Also Attending: REPRESENTATIVE ANDREA DOLL; LARAINE DERR, Vice-
chair, Alaska Mental Health Trust Authority; JEFF JESSEE, Chief
Executive Officer, Alaska Mental Health Trust Authority.
Attending via Teleconference: There were no teleconference
participants.
SUMMARY INFORMATION
^Alaska Mental Health Trust Authority
Presentation by Jeff Jessee.
9:03:56 AM
Co-Chair Hoffman identified two documents to accompany the
presentation, one titled "Legislative Fiscal Analyst's Overview
of the Governor's FY08 Request" [copy on file] prepared by the
Division of Legislative Finance, and the related legislation,
Senate Bill 51.
9:05:02 AM
LARAINE DERR, Vice-chair, Alaska Mental Health Trust Authority,
introduced herself as the Vice-chair of the Authority and the
Chair of Finance for the Authority.
9:05:48 AM
JEFF JESSEE, Chief Executive Officer, Alaska Mental Health Trust
Authority, directed members to the handout titled "The Trust;
History of the Alaska Mental Health Trust Authority" [copy on
file].
9:06:36 AM
Page 1
Territorial Days
™All mental disabilities lumped together.
™"Insane Person At Large" - A territorial crime.
™Federal marshals transport to Morningside in Oregon.
Mr. Jessee reviewed the information on the page, adding that the
crime of being an "insane person at large" required no act of
wrongdoing. The mere existence of a mental disability was
sufficient to commit a person for life to the Morningside
hospital.
9:08:04 AM
Page 3
Barriers to Statehood
™No way to continue payment for Morningside.
™Territorial mental health "program" unacceptable to
Alaskans.
™Washington Post exposes "Siberia USA."
Mr. Jessee summarized the page, stressing that the Washington
Post headline implied that the creation of a State mental health
program in Alaska would result in a "gulag" to which dissidents
would be sent.
9:08:52 AM
Page 4
Alaska Mental Health Enabling Act of 1956
™Cash payment for construction of API and purchase of
Harborview.
™Phased out operational support to wean Alaska off
federal dole.
™1,000,000 acres of land in trust to generate money to
pay for ongoing expenses.
™State legislature appointed trustee.
Mr. Jessee pointed to a three-pronged approach to address
Alaska's mental health needs. The first was the construction of
the Alaska Psychiatric Institute (API) and the purchase of what
would become the Harborview Developmental Center. He asided that
the Harborview Motel in Valdez was purchased by Governor Egan to
generate employment and revenue for his hometown, as well as to
provide for mental health needs of the State. The federal
Enabling Act secondly provided funding for these projects to
diminish over a period of eight years, and, thirdly, established
the Mental Health Land Trust.
9:10:27 AM
Page 5
Early Land Trust Management
™Desirable Trust lands selected first.
™Legislature designates some trust land as state parks,
forests, and wildlife preserves (over 350,000 acres).
™Legislature releases 50,000 acres to 5,000 individuals
through homesteading, lotteries, and sales.
™Legislature allows local governments to select over
40,000 acres.
Mr. Jessee remarked that the State "did an excellent job" of
selecting the Trust lands, which included the Homer Spit, Kenai
River frontage, portions of the Chugach State Forest, Beluga
Coal Fields, and much of the areas surrounding the communities
of Southeastern Alaska. When the State of Alaska received 100
million acres of land via the Statehood Act, the one million
acres of Trust lands were "rolled into" the other federally
granted lands. For several years the State treated the Trust
lands the same as other State lands, and during that time, half
of the one million acres was taken out of trust through the
establishment of wildlife preserves, sales, and homesteading
allowances.
9:12:41 AM
Page 6
A Change in the Climate
™Internal DNR memos raise concern over trust land
management.
™"Moms and pops" have problems with financing due to
title issues.
™Local governments are on notice that the state has
breached trust and they do not have clear title.
™Legislature realizes that land removed from trust has
clouded title.
Mr. Jessee noted that the mismanagement of the Trust lands
became apparent in the 1970s when local governments were allowed
to select land from the State for their own use. When local
organizations selected lands and went to record their title, it
was revealed that nearly 25 percent of the lands chosen were
Mental Health Trust lands. While the Trust lands comprised only
one percent of the total State lands, the Trust lands were
highly desirable and thus accounted for 25 percent of the lands
selected by local entities.
9:13:10 AM
Page 7
Damage Control
™1978 Legislature redesignates trust land as general
state land.
™Mental health income account created to compensate
trust for lost revenue.
™Legislature never makes any deposits.
Mr. Jessee reviewed the information on the slide, adding that
within three years of the establishment of the mental health
trust income account, officials realized that no deposits were
being made.
9:14:06 AM
Page 8
Litigation
™Weiss v. State filed as a class action in 1982
alleging breach of trust. Class broadly defined.
™Alaska Supreme Court rules in 1985 that trust must be
reconstituted buy only 35% of original land remains.
™Court injunction freezes all activity on all trust
land.
Mr. Jessee relayed that the Alaska Supreme Court relied on
"private trust principles" in determining that the State had
breached its trust responsibility. The Court identified the
remedy as the return of the lands to the Trust, which was not
"feasible". Since the original lands could not be returned due
to various forms of development, the result was over a decade of
negotiations, during which time much of the land was "frozen".
9:16:30 AM
Page 9
Beneficiaries Defined
™mentally ill,
™chronically alcoholic
™Developmentally disabled
™Suffering from Alzheimer's and related dementias
Mr. Jessee read the page, adding that the Trust's beneficiaries
were defined in the course of the litigation.
9:16:58 AM
Page 10
Settlement Attempts
™Specially appointed commission values trust land at
$2.2 billion.
™1987, 1990, 1991 - major failed settlement attempts
based on percentage of general fund revenues or land
swaps.
™After the 1991 settlement attempt is rejected by Judge
Green, "unholy alliance" of stakeholders gathers to
craft final settlement package.
Mr. Jessee overviewed the information.
9:17:14 AM
Page 11
1994 - Settlement at Last!
™Designation of 995,502 acres to be managed by a
special unit within DNR
341,421 - subsurface estate
104,286 - hydrocarbon interest
549,795 - fee simple
™Appropriation of $200 million to a trust fund to be
managed by the Alaska Permanent Fund Corporation.
Mr. Jessee identified the Trust's goal of reestablishing the
million acre land trust as initially provided for by Congress. A
diverse group of stakeholders was assembled to develop a
replacement list of one half million acres to make the Trust
whole. These lands would be managed by the Trust Land Office
within the Department of Natural Resources, and would operate
under trust principles rather than general State land management
principles.
Mr. Jessee informed that the replacement lands were not as
valuable as the originally selected properties. The difference
in value was agreed to be $200 million which the State
appropriated, and is managed by the Permanent Fund Corporation.
9:19:37 AM
Page 12
1994 - Settlement at Last!
™Creation of the Alaska Mental Health Trust Authority
to act as trustee. Separate appropriations bill for
mental health program.
™Comprehensive Integrated Mental Health Program Plan
required.
™Four advisory boards make budget recommendations to
Trust trustees.
™Commissioners (DNR, DOR, DHSS) designated as advisors
to The Trust.
Mr. Jessee indicated the "most important" aspect of the
settlement was the creation of the Mental Health Trust Authority
Board of Trustees, which acts as a trustee of the Trust to
improve mental health services throughout the State.
Mr. Jessee noted the settlement also created an integrated
mental health program by regrouping all of the services offered
by the State into one budget appropriation that included both
capital and operating costs. Additionally, the Department of
Health and Social Services (DHSS) was charged with creating a
"comprehensive integrated mental health plan". Benchmarks and
performance measures are reflected in the plan, as the trustees
have placed great value on accountability and a focus on
results. Results are monitored both in terms of the number of
people assisted by a program, and the number of those people who
remain "better" after a period of time. He encouraged Members to
examine the DHSS Bring the Kids Home program in terms of the
benchmarks and program results.
9:24:09 AM
Page 13
Trust Mission Statement
™The Alaska Mental Health Trust Authority administers
the Mental Health Trust established in perpetuity. It
has a fiduciary responsibility to its beneficiaries to
enhance and protect The Trust and to provide
leadership in advocacy, planning, implementing and
funding of a comprehensive integrated mental health
program to improve the lives and circumstances of its
beneficiaries.
Mr. Jessee identified the Trust mission statement.
9:24:19 AM
Page 14
The Trust Authority Roles
™Oversee management of Trust assets.
™Maintain Trust management framework.
™Safeguard Annual payout from principal (currently
4.00%).
™Maintain Budget reserve account.
™Inflation proof principal to preserve Trust for future
generations.
™Spend trust income.
™Separate Mental Health budget bill - recommend to
Governor and Legislature how the State of Alaska
should spend general fund resources.
Mr. Jessee informed that the trustees expend a percentage of the
endowment each year. As a perpetual trust, the trustees could
not pay out any of the principal trust dollars, and have
therefore allocated a portion of the funds to a reserve fund.
The Trust hired Callan & Associates, a consulting firm, which
advised that an amount equal to four times the annual payout be
placed in an income reserve account to be used in times of poor
market returns. This ensures a consistent level of funding and
allows for long-term projects.
Mr. Jessee told that at one point, the reserve balance fell to
158 percent from a target of 400 percent. When the reserve
reached the targeted 400 percent, the payout would be increased,
and the amount paid into the reserve account would increase
correspondingly. The current payout is four percent, and would
likely not increase over 4.75 percent.
9:27:43 AM
Senator Huggins referred to the last bullet on Page 14, and
asked whether the Trust had already communicated its
recommendations to the Governor and Legislature for FY08.
Mr. Jessee affirmed.
Senator Huggins asked the time schedule for those
recommendations.
Mr. Jessee replied that the Trust is required by statute to
provide that information by September 15. He continued that
after the Trustees forward recommendations to the legislature
and governor, and, if either body does not follow the
recommendations of the Board, it must provide a written
explanation to the Trustees of why the recommendations were not
adhered to. This provides an opportunity for "policy dialogue"
between the two bodies and the Board.
9:29:54 AM
Page 18
Beneficiaries by the Numbers:
™8.5% of Alaskans age 18 and over have a Serious Mental
Illness.
™An estimated one in 10 Alaskans over age 65, and
nearly half of those 85 or older have Alzheimer's
disease.
™Approximately 11,500 Alaskans have developmental
disabilities.
™15% of all Alaskans aged 18 to 25 are "heavy
drinkers."
Mr. Jessee reviewed the slide, and commented that the Pioneers
Homes are transitioning to serve the needs of an increasing
number of Alaskans with Alzheimer's disease or other dementia.
9:31:11 AM
Page 19
Focus Area: Justice for Persons With Disabilities
™Up to 37% of persons in custody or under supervision
of the Department of Corrections suffers from a mental
illness, and 12% have major psychiatric disorders.
™This special program is funded in large part by the
AMHTA, and is aimed specifically at getting mentally
ill people out of the pattern of repeated petty
crimes.
Mr. Jessee revealed that initially the Trustees sought to make
major far-reaching changes to the mental health system. When
that approach proved less effective than desired, the Board
amended their method to focus on five specific areas. These
areas are issues that the Trustees identify as significant, and
they commit to attend to for an average of four to six years, or
until marked progress is made.
Mr. Jessee told that one focus area was justice for persons with
disabilities. He noted that the Department of Corrections is the
single largest mental health provider in the State. The Trustees
seek to affect this group of persons in need of mental health
services on three levels: therapeutic and mental health courts;
opportunities to assist those in custody; and methods to help
offenders upon release so they do not return to custody. Mr.
Jessee mentioned that incarcerated persons are now prequalified
to receive Social Security assistance before release from
prison.
9:34:24 AM
Page 24
Focus Area: Bring the Kids Home
™Today nearly 700 Alaskan youth receive care at a
Residential Psychiatric Treatment Center outside the
State of Alaska.
™This initiative has been designed to reverse the trend
of exporting young Alaskans with serious emotional
disturbances.
Mr. Jessee noted that the Board had collaborated extensively
with the Department of Health and Social Services, and had
"turned the curve" in returning Alaskan youth to the state.
Alaska Natives constitute 40 percent of the youths in treatment
outside of the state, therefore the Trustees have worked in
partnership with tribal providers to serve people within their
system.
9:35:13 AM
Page 27
Focus Area: Beneficiary Project Initiatives
™The Trust combines financial support with technical
assistance options. Beneficial results include:
o The creation of sustainable organizations
controlled by the beneficiaries.
o The creation of innovative programs to better
serve the beneficiaries.
Mr. Jessee summarized this focus area by stating: "It is not
necessary for people to totally be dependant on government-
funded treatment programs. People can and do recover, and are
able to support each other in that recovery."
9:35:43 AM
Page 29
Workforce Development
™A trained workforce is critical to all Trust
beneficiary services. The Trust is working in
partnership with the University of Alaska, State of
Alaska, service providers, professional organizations
and the Alaska Native Tribal Consortium to develop
strategies to prepare new workforce and to recruit and
retain people in the workforce.
Mr. Jessee informed that workforce development is applied to all
of the Authority's focus groups. A shortage of health care
providers exists in the state to offer assistance to those with
mental health needs.
9:36:50 AM
Mr. Jessee played a video for the Committee. The following is a
transcript of the presentation.
Narrator:
Many people think that the homeless population is made
up mostly of alcoholic single men who just don't want
to work. But the reality is quite different. In
Alaska, the average age of a homeless person is nine
years old.
Alaska is one of the wealthiest states in the nation.
Yet on any given night approximately 3500 Alaskans are
homeless. People are at risk of homelessness when they
have to choose between food, shelter, and other basic
needs. All it takes is an unexpected medical bill to
put someone on the street.
Alaskans want to help. In a recent statewide public
opinion survey, 90 percent agreed that we have a
responsibility to help people who need a place to
live.
In Alaska there is a gap between what low-income
people can afford for housing and what housing
actually costs.
9:38:04 AM
Dan Fauske, CEO/Executive Director, Alaska Housing Finance
Corporation, Department of Revenue:
Average cost of a new home in Anchorage, for instance,
is around $329,000. That takes some income to support
that kind of debt.
Even in the rental market, if you're on disability or
unable to work, for whatever reason, you're not going
to be able to even afford rent.
Narrator:
Who is homeless in Alaska?
9:38:56 AM
Jeff Jessee:
They're barely making it on the salary that they have,
and it doesn't take much. A car repair, and emergency,
a medical emergency, they often don't have health
insurance either. Any sort of additional expense and
they are pushed over the edge.
Narrator:
The fact is about 45 percent of Alaska's homeless are
families with children.
9:39:15 AM
Tawnya:
I lost my job. My mom passed away. I missed a lot of
work. And it made it difficult. And so we ended up not
being able to pay our bills. And so we ended up being
homeless.
Kuya:
I was employed, working. I'm a single parent with
three kids. How everything came crashing down is when
I got sick at work, and I didn't have any leave, and
there was nobody there to help. It went from bad to
worse. I lost my car. So then we didn't have
transportation. I had no idea how I was going to get
my children to school.
Narrator:
More than 3,000 school children who are homeless or
inadequately housed at some time during the 2005-2006
school year.
9:39:55 AM
Barb Dexter, Child in Transition/Homeless program,
Anchorage School District:
The average age of a homeless person is nine years
old. And we anticipate that even getting younger
because the largest growing population are families
with young children.
Carol Comeau, Superintendent, Anchorage School District:
Homeless kids, if they're moving around a lot and
they're not able to go back to the same school during
the year, they don't do as well. Most of them are
embarrassed about their situation. A lot of them don't
like to talk about it, so they put some kind of
protections around themselves.
9:40:27 AM
Tawnya:
Us being in the shelter, actually, my youngest
daughter has gotten -- we got her first report card;
she got all F's. It was very stressful for her. A lot
of sleepless nights. Didn't know what to do. Didn't
want to do her homework. She regressed really bad.
Barb Dexter:
One of the things that you look at is that children
who experience homelessness are four times as likely
to have learning disabilities, to have significant
cognitive delays.
Narrator:
Homeless children experience more mental health
problems such as anxiety, depression, and withdrawal.
Children without a home are also more likely to suffer
from asthma, ear infections, stomach complications,
and speech problems.
About 14 percent of Alaska's homeless are severely
mentally ill.
9:41:02 AM
Narrator:
Nena was homeless and slept on couches at her friends'
house and sometimes on the street.
Nena:
My mother died and I went through a mental breakdown
and I got sick and lost everything. Had to forfeit my
condo and my car. I functioned normally. I functioned
normally. I just had auditory hallucinations.
Jeff Jessee:
We have so many people that have a mental illness or
chronic substance abuse problem and they cycle in and
out of the psychiatric hospital, in and out of jail
for petty misdemeanors. If they are able to actually
find a secure home and have the support services that
they need, and realize that over time they could
actually remain stable in the community, then that's a
life-changing experience for them.
Narrator:
Homelessness costs Alaska.
Hospitalization, incarceration, and mental-health
treatment are just some of the costs a community must
bear.
The Federal Government provides the lion's share of
housing assistance, but it does not adequately focus
on the problems faced by those who are on the brink of
homelessness, or those who have already been forced
out of their homes.
9:42:42 AM
Narrator:
How can we help?
A major step is the Alaska Housing Trust.
Jeff Jessee:
Well, the Housing Trust is a strategy that many states
and other jurisdictions are using now to try to take
our existing housing programs and target them more
directly to people that are homeless or at risk of
becoming homeless.
Narrator:
In 2004, the Governor created the Alaska Council on
Homelessness to address the issue of homeless Alaskans
and those struggling to stay in their homes.
The Council was composed of representatives of a
number of state and federal agencies.
9:43:33 AM
Dan Fauske:
Within that group were eight Commissioners, the head
of the Alaska Mental Health Trust Authority, HUD, and
the Lieutenant Governor.
We met numerous times and gathered testimony and
information from a variety of participants to gain as
much knowledge about the subject of the homelessness
throughout the state as we could. What we have arrived
at was creating a housing trust to help support
homeless issues and financing for homelessness.
9:44:43 AM
Narrator:
More than 30 states across the nation have created
successful housing trust funds. Housing trust fund
activities that reduce homelessness.
Some of those activities include the construction of
new housing; the rehabilitation of existing housing;
the purchase of land; the establishment of a community
land trust; and the modification of housing to make it
accessible.
Housing trusts can also provide down payment and
deposit assistance; rental assistance; tenant
education; case management and counseling; financial
counseling; and crisis intervention services.
The Housing Trust will use proven strategies like the
program started in Seattle by the Bill and Melinda
Gates that provided $40 million to build 1500 units of
service-enriched housing.
Strategies implemented through housing trusts in the
lower 48 have successfully addressed the issues faced
by the homeless. They've also served the needs of
those who work but are still at risk of homelessness.
It's time to make it work in Alaska.
By using innovation derived from the successful pilot
projects around the state and the nation, the Alaska
Housing Trust seeks to create long-term, affordable
housing to reduce homelessness and to help those
struggling to stay in their homes.
The Alaska Housing Trust: Opportunity begins with a
home.
9:45:38 AM
Mr. Jessee shared that the majority of housing assistance
funding is allocated to people with an income 70 percent or
above the area median income. This is due to two factors. The
first is that projects "pencil out better" if the tenants could
contribute more money to the program in the form of rent.
Secondly, homeless people are typically homeless because they
suffer from other problems, including alcoholism or substance
abuse, domestic violence, or health issues.
Mr. Jessee explained that a housing trust differed from the
conventional approach in that a housing trust links support
services directly to the housing developments. He exampled the
success of the Gates Foundation, which had reduced the
percentage of school-aged kids who attended more than two
schools in a year from 25 percent to five percent. He suggested
that revenue generated by the Alaska Housing Finance Corporation
could be used to fund a housing trust to address the homeless
issue.
9:48:25 AM
Co-Chair Hoffman asked if SB 51, appropriating Mental Health
Trust Authority funds for FY08, is supported by the Trust.
Mr. Jessee reported that the Authority generally supports the
bill, but noted that a number of recommendations from the Board
were not included in the current legislation. The Trust would
continue to work with the Administration and the subcommittees
to address concerns.
Co-Chair Hoffman asked if Mr. Jessee anticipated amendments to
the bill.
Mr. Jessee affirmed, indicating his expectation that Governor
Sarah Palin's budget amendments would contain amendments to the
mental health bill.
9:49:17 AM
Senator Dyson mentioned Alaska's problem with "fetal alcohol
spectrum disorder," and asked if diagnostic services were
available to the Authority's clients.
Mr. Jessee responded that the Trust had made progress and was
concluding a five year federal grant program to address the
issue. The federal grant had assisted in evaluation services and
the establishment of prevention programs. However the funding
would not continue and unless replacement funding could be
identified, those programs would cease.
Senator Dyson asked the amount of the federal grant.
Mr. Jessee understood the necessary level of funding was
approximately $500,000.
9:50:27 AM
Senator Huggins asked the percent of homeless who were veterans.
Mr. Jessee was not sure of the percentage, but agreed that many
veterans were homeless. He stressed that a key factor in
maintaining housing for previously homeless veterans was support
services, as many of them had issues beyond homelessness.
Senator Huggins asked Mr. Jessee's opinion of the success rate
of a Veteran's dormitory administered by the Veteran's
Administration.
Mr. Jessee characterized the program as "very successful" in the
areas where it provides services, but commented that it does not
address long term needs of the people being served.
Senator Huggins recalled that the program includes treatment,
placement in employment, and temporary subsidized housing.
9:52:24 AM
Mr. Jessee concurred, adding that the continuation of services
was where our system was "particularly weak".
9:52:35 AM
Senator Thomas inquired the cost of providing out-of-state
treatment for the 700 youths currently receiving those services.
Mr. Jessee estimated that cost at $35 to $40 million each year.
9:52:58 AM
Co-Chair Hoffman informed that Mr. Jessee would likely be back
before the Committee during the amendment process.
ADJOURNMENT
Co-Chair Lyman Hoffman adjourned the meeting at 9:53:11 AM
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