Alaska News

Delay in grant payments by state threatens health nonprofits

Some of Alaska's social services agencies said this week they're barely scraping by in the face of delayed state grant funding brought on by the Legislature's late budget, and a new state computer accounting system.

State health officials said Wednesday the Department of Health and Social Services, which provides a safety net for addicted, chronically ill and needy Alaskans, has awarded about 45 percent of its grants. That's compared to nearly 96 percent of grants awarded this time last year, said Sarana Schell, spokeswoman for the Division of Behavioral Health.

Back in May, the health department warned grant recipients the replacement of the state's 30-year-old financial and accounting system would lead to delays. But the challenges of training employees on a new system were made worse by the state budget battle, said Andy Mills, spokesman for the state Department of Administration. It took the Legislature an extended regular session and then two special sessions to pass a budget.

On Wednesday, some nonprofits that fund substance abuse or mental health treatment programs said they hadn't even yet received notice their fiscal year 2016 grants would be coming. That includes one of Anchorage's two clinics that dispense methadone to patients addicted to opiates like heroin and prescription pain pills, which said it's been turning people away.

"We're just shutting down," said Jennifer Stukey, chief operating officer of Narcotic Drug Treatment Center Inc. "We can't admit, we can't do anything."

She said the clinic isn't even enrolling pregnant women, typically a priority population.

Health department officials, meanwhile, stressed Wednesday that struggling nonprofits should contact program managers in state government and ask for help if they're pinched financially. Schell wrote in an email that the timing depends on how fast the department can send grant awards and how quickly providers can return the paperwork.

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"This is a priority for the department," said Sana Efird, assistant DHSS commissioner. "We're focusing resources to get this done."

Randall Burns, the department's emergency services program specialist, said the state expected to issue notice of grant awards to the remaining recipients by the end of the week.

Mills of the Administration Department, said the new system -- the Integrated Resource Information System, or IRIS, named in an employee contest -- hasn't been belabored by technical problems. The hitch is in the training of new employees and integrating the new system into the state's workflow.

Schell said fewer than 10 percent of the Division of Behavioral Health's grant recipients had called about the delay. She said once the new system is fully in place, "the state will have a more sophisticated, efficient system that should make life easier for everyone -- state administrators and grant recipients."

But nonprofits said they're anxious amid the unusual delays. Rosalie Nadeau, executive director of Akeela House, said the nonprofit has received notice to eventually expect some of its smaller grants, but had not received notice on its three larger ones.

She said Akeela isn't turning anyone away. But she said the organization has opened a line of credit to keep up with payroll. She said the organization usually receives its full grant funding a few weeks into July.

"This is the worst I've seen it and I've been here 24 years," Nadeau said. She said she worries about smaller organizations more susceptible to interruptions in cash flow.

At Nugen's Ranch, the Matanuska-Susitna Borough's only long-term substance abuse treatment facility, Karen Nugen-Logan said she can't close her door, because she has people in treatment on a full-time basis. She said she has access to a line of credit, but she's holding off on using it and running through reserves instead.

"(Credit) just puts you further and further in the hole as a nonprofit," said Nugen-Logan, who has been working with the facility for 30 years.

She said she keeps hoping every day her grant agreement comes out.

Mat-Su methadone clinic to close

For those addicted to heroin, already limited access to services is compounded by the planned closure next month of a privately owned methadone clinic in Wasilla, the only one in the Valley.

John Zipperer, who owns ZMG-OTP in Wasilla, said in a phone interview Thursday that he gave his clients a 30-day notice of closure.

"I made the decision, due to multiple reasons, to close the program," Zipperer said, declining to elaborate further. The clinic had only been open for about a year.

Burns, the state health department official, said Zipperer has told clients about Anchorage's Narcotic Drug Treatment Center, as well as the for-profit Anchorage Treatment Solutions.

"But, of course, for residents of the Valley, having to drive into Anchorage … it would be much better if individuals could seek that kind of assistance within the Valley," Burns said.

He said access to heroin addiction treatment for Valley residents has long been an issue.

"And we were, for that reason, glad to see he was interested in opening up," Burns said. "We're sorry he's closing."

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Zipperer has offered to transfer his 36 cases to either of the Anchorage programs, Burns said.

Stukey, of the narcotic treatment center, said the facility wouldn't have the capacity for the new patients even with full state funding. But Mary Kenshalo, director of the Anchorage Treatment Services clinic, said she'd been in touch with Zipperer and told him her clinic had room for all 36 patients.

"We're really trying to get that message across … they don't have to taper, they can transfer right to our clinic," Kenshalo said.

Devin Kelly

Devin Kelly was an ADN staff reporter.

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