Reporting From Alaska

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Reasonable rate hikes for Pioneer Homes—another victory for the Dunleavy recall

When Mike Dunleavy ran for governor in 2018 he promised that there would be no budget cuts at the Pioneer Homes, meaning no rate hikes.

Without warning in early 2019, he proposed the biggest rate increase in history for residents of the homes, whose average age is pushing 90. Despite public opposition, he approved increases last summer for residents that ranged from $12,000 to nearly $100,000 per year.

But that was before the recall emerged as a serious political threat to his political survival.

On Thursday, with the recall still looming in the background, Dunleavy signed a bill opposed by only four legislators that reverses the unfair Pioneer Home rate decision he made last summer.

Had Dunleavy said anything during his campaign about wanting to charge Pioneer Home residents thousands or tens of thousands more per year, his plan might have been more defensible than despicable.

“If you can afford to pay for it, we’re asking you to pay for the cost,” is how Donna Arduin, the former temporary budget director, described the Dunleavy approach to the Pioneer Homes.

Bankrupt residents who couldn’t afford the higher rates or those who would soon become bankrupt would qualify for a state subsidy and would not be kicked out of the homes, the administration said.

Dunleavy never took responsibility for the rate increases that went into effect last September. He had Clinton Lasley, then the director of the pioneer homes, deliver the bad news to residents in early 2019.

The letter from Lasley should have started with an apology. Instead, it began with “Subject: Governor’s Honest Budget: Sustainable, Predictable, Affordable.“

“As you have all heard over the past few months, the governor fully intended on putting together a budget in which expenditures cannot exceed existing revenue,” Lasley said.

“To meet the expectation of a budget where expenditures cannot exceed existing revenue, I will be putting forward a regulation package in the coming days that aligns our rates with the cost of providing services,’ Lasley wrote to residents last February.

“The new rates align with the cost of providing exceptional services at our homes,” he said.

In August, Adam Crum, the health commissioner and a former deputy treasurer of the Dunleavy campaign, was still claiming that the much higher rates were justified.

“The previous rates did not cover the full cost of services, which meant the state of Alaska was subsidizing care for every resident, even those who were able to pay more toward their cost of service,” said Crum.

The state House approved a bill by Rep. Zack Fields last year, on a 35-4 vote, limiting rate increases to the cost of living, but Dunleavy pressed ahead with the rate hike anyway.

I wrote here on Feb. 16, 2019 that there was a zero chance of the rate hikes going into effect because of the legislative opposition. It took a bit longer than expected, but the Legislature did the right thing when the governor didn’t.

“Raising Pioneer Home rates by an extreme amount is an important policy call, one that Dunleavy forgot to mention during his campaign. It is among those that should be stopped by the Legislature,” I wrote.

This year, the Senate, thanks to the leadership of Sen. Cathy Giessel and others, unanimously approved the bill to stop the Dunleavy rate hikes. The plan approved by the Legislature takes a far more reasonable approach on rate changes.

On Thursday, Dunleavy signed the bill. The Dunleavy public relations department, as the Associated Press put it, said it “had nothing to add beyond confirming Dunleavy had signed the bill.”

That’s too bad. He owes the residents of the homes and their families an apology. In this case, the Legislature and the recall delivered.