Pioneer Home residents file class action lawsuit against Dunleavy admin to halt rate hikes

Three Pioneer Home residents and their families today filed a class action lawsuit against Gov. Michael J. Dunleavy’s administration over rate increases put in place this summer, seeking to bar the state from enforcing monthly rate increases that were as much as 140 percent in some cases.

The lawsuit is brought by married couple Marion and Howard Rider who live in Juneau’s Pioneer Home, their adult son Brad Rider, and Ketchikan Pioneer Home resident Eileen Casey. The attorneys on the case are Vance Sanders and Libby Bakalar, a former state attorney whose controversial firing by Dunleavy has resulted in its own lawsuit.

“Today my colleague Vance Sanders and I filed a class action lawsuit against the Dunleavy admin for its catastrophic rate hikes to the 497 elders and residents of the Alaska Pioneers Homes. These rate increases are inequitable and unconscionable,” Bakalar wrote on Twitter. “We aim to stop Dunleavy from enforcing them.”

Filed in the Ketchikan Superior Court, the lawsuit argues that the rate increases implemented by the Dunleavy administration essentially broke the state’s promise to seniors because the seniors had grown to expect and planned for moderate rate increases over time. The legal concept is called equitable estoppel. The suit seeks to halt the increases.

“Pioneers’ Home residents relied on the rates under which they signed their contracts and reasonable rate increases when they signed admission to the homes,” argues the suit. “They did not reasonably expect their rates to increase so astronomically in a single month, thereby depriving them of the time and ability to make family budgeting plans, possible relocation and similar important decisions.”

[PDF: Read the group’s filing here.]

Though the state has argued that seniors won’t be evicted if they fail to pay, noting the creation of a payment program, the lawsuit argues those promises are meaningless.

“Pioneers’ Homes residents are suffering extreme prejudice because they face eviction for ‘refusal to pay costs incurred’ under the residential services contracts with the homes and have no other source of housing or care. Although (Pioneer Homes) Director (Clinton) Lasley represented that residents will not face eviction for non-payment of increased rates, that representation is arbitrary and not credible; it both contradicts the terms of the residents’ contracts with the homes, and the Pioneer Homes has, in fact, threatened residents with eviction for non-payment of rates and/or evicted residents in the past for that reason.”

It also references reporting like that from the Anchorage Daily News that illustrated how the rate changes are already driving dramatic changes for seniors, including one couple who were told their best option for dealing with the rate increases was to file for a divorce. The lawsuit argues that the impact of the astronomical rate increases is to force many seniors into poverty so they can tap into social service programs to cover the monthly fees.

“The end result of the Pioneers’ Homes sudden rate increases is that with no meaningful notice, middle-income seniors are forced to divest all of their assets and modest savings, go into poverty programs, or move out of the Homes and/or the state,” argued the lawsuit. “In initiating these cuts, Governor Dunleavy has created a manufactured crisis for Alaska’s seniors that could easily have been avoided through a well-publicized, gradual rate increase.”

Why it matters

The Pioneer Homes were one of the main targets in the governor’s budget, which sought to cut about $12 million of state support and bolster it with astronomical rate increases. The governor has argued that it’s important for services to cover their costs with fees, but the reality of the Pioneer Homes is the cost to deliver intensive 24/7 care to seniors—including those dealing with memory issues—is expensive.

At the core of the Pioneer Home program was an idea that Alaska should help take care of the people who built the state, particularly when a major lack of senior care in Alaska means many seniors are forced to move Outside for late-in-life care. That’s also a big underpinning of this lawsuit, which taps into the common law concept of equitable estoppel.

The Alaska Supreme Court has already laid out the guidelines for such a decision, noting that claims must meet four elements for the court to rule against the state: “(1) the government body asserts a position by conduct or words; (2) the private party acts in reasonable reliance thereon; (3) the private party suffers resulting prejudice; and (4) the estoppel serves the interest of justice so as to limit public injury.”

It’s also hard not to notice that one of the attorneys bringing the lawsuit is former state attorney Libby Bakalar, who was targeted in the governor’s loyalty pledge firings when he entered office. Bakalar has been politically outspoken on her personal Twitter account and blog, but most involved in Alaska’s legal system would have told you that Bakalar is a talented attorney who left her personal politics at the door when arguing in favor of issues related to resource development and other things for the state.

In the year since her firing, Bakalar has been a sharp critic of the Dunleavy administration—particularly when it comes to its legal positions—has vowed to be a thorn in the side of the administration.

She’s a plaintiff in a lawsuit arguing the state violated her First Amendment rights to free speech through the loyalty pledge firings, but this case is the first that she’s acting as an attorney.