The CEO of the Alaska Mental Health Trust Authority resigned Wednesday and will take on a different role in the organization. Jeff Jessee served in the position for 21 years. Some of the trustees allege that his resignation indicates violations of the Alaska Open Meetings Act.
Jessee submitted his resignation letter during a special meeting of the board of trustees on Wednesday afternoon. In a phone interview Wednesday evening, trust Board Chair Russ Webb said the transition has been under discussion for several years, though an unofficial transcript of the meeting shows that several board members were surprised by the decision.
When asked over the phone why he was changing roles, Jessee, who was accompanied by the trust’s chief communications officer, began reading from his resignation letter.
“‘It is clear that a majority of the board of trustees believes that significant changes in the trust’s organization and efforts must be made to meet these challenges,'” he read. “And they believe ‘these changes will require new perspectives and ideas to ensure that the Trust can meet the needs of the beneficiaries well into the future.'”
When asked if he agreed with this position he responded, “Well, I believe it’s in the best interest of the beneficiaries, the trust and myself that I take a position within the trust where I can continue to serve the beneficiaries, which is why I got into this field in the first place.”
When asked if he felt the best position he could be in would not be as the CEO, he paused for several seconds before declining to comment.
Jessee will be transitioning to a new role focused on programming, ahead of his planned retirement in three years.
The Mental Health Trust was created to fund comprehensive care for people with mental health illnesses and other disabilities. It is a state-owned corporation with cash and land assets that are managed by different state agencies.
If the Governor’s office approves, Greg Jones, who formerly served as the executive director of the Trust Land Office, will serve as the interim CEO.
The decision for Jessee to switch roles and Jones to take his place passed by a vote of 4 to 3.
During the meeting, Mental Health Trustee Laraine Derr alleged that other trustees were holding secret meetings about the future structure of the trust.
“You’re trying to move Jeff out of his job, and you don’t know where you’re going,” Derr is quoted as saying in the transcript. “I mean, I assume you probably do, because you guys have had enough meetings, secret meetings that we don’t know what’s going on… Until yesterday, I didn’t know what you guys were doing. We have not been included. You’re trying to remove the CEO… there are three of us sitting here that don’t know — that have never been involved in a meeting.”
Fellow trustee Jerome Selby agreed. Speaking from his cell phone at the airport, he said he did not receive any information about the resignation before the meeting. There was not a board packet either.
“The motion that was read–that accepted Jeff’s resignation, appointed this person I’ve never heard of as the interim CEO, and then gave instruction to that new interim CEO to put Jeff in this new position–had never been discussed at any meeting that I’m aware of. Official meeting,” he said. “So how did it get to the meeting yesterday, all written out? There must have been a fair amount of discussion going on among those four people which violated the Open Meetings Act of the State of Alaska.”
The board has been openly discussing hiring someone to look at the organizational structure of the trust.
Selby said it’s a bad time to lose someone like Jessee in the CEO position, especially because of his experience advocating on behalf of trust beneficiaries in the Legislature.
“I think it’s the worst possible time for him to resign, personally. We’re facing what’s probably going to be one of the hardest legislative sessions budget-wise in the state of Alaska.”
The trust was also recently criticized in a letter written by former Attorney General Bruce Botelho and former Commissioner of Natural Resources Harry Noah, both of whom were involved in establishing the trust in 1994.
In the letter, Botelho and Noah ask Rep. Mike Hawker and the Legislative Budget and Audit Committee to request a special audit because they believe the corporation is not following the statutory requirements for how its assets are managed.
They allege the board is taking money from the principal of the trust and using it to buy real estate instead of contracting with the Alaska Permanent Fund Corporation to manage the assets as is required by statute.
During the meeting, Board chair Webb directed the board to discuss the letter at a later date, after they had fully read and understood it.
Jessee did not have any comments on the letter and said it was not part of the decision for him to shift roles.
In a phone interview Wednesday, Webb called it a “separate and irrelevant issue” and said the allegations that others are managing the fund are “manifestly untrue.”
Selby, who was appointed to the Board in February, said the concerns about the Trust’s fiscal management need to be taken seriously and investigated. “All of my red flags are waving at the moment.”
Webb could not be reached for further comment. Jessee said he is not usually involved in revenue generation for the trust.
The exact details of Jessee’s new role and salary are yet to be determined. In 2015, he received more than $215,000 in compensation.
Read the full transcript here.
Read Jessee’s resignation letter here.
Read Botelho and Harry’s letter here.
Anne Hillman is the healthy communities editor at Alaska Public Media and a host of Hometown, Alaska. Reach her atahillman@alaskapublic.org. Read more about Annehere.
