Section 1: BILL SCHNEIDER: Okay. Today is April 5th, 2007. I'm Bill Schneider, and I have the pleasure today of talking with Jim Gottstein. And I really appreciate you taking the time, Jim.

And we're going to talk about your personal background and a little bit about how you got into the Mental Health Trust litigation and some of those issues. And we'll go as far as you want today, and maybe pick it up later, if you want to do that.
JIM GOTTSTEIN: Yeah.

BILL SCHNEIDER: So thanks, Jim.
JIM GOTTSTEIN: You bet. My pleasure.
BILL SCHNEIDER: Let me make sure I'm hearing everything okay. Okay.

Why don't we -- why don't we start by your talking a little bit about the -- your personal background. And talk about your parents and -- and your heritage here, and then we'll bring you up to your childhood.

JIM GOTTSTEIN: Well, I grew up here. I was born in 1953. My grandfather came up in 1915, and came to Anchorage when it was called Tent City, the year that Anchorage was founded. As a young man, he had made his fortune selling tobacco and confections to the railroads, the last of the great railroad building in the Pacific Northwest and Canada.
BILL SCHNEIDER: Wow.

JIM GOTTSTEIN: And made his fortune and retired to Europe to live like royalty. And went through his money in a few years and came back, he was from Seattle, and found out they were building a railroad in Alaska.

And came up here and founded J. B. Gottstein and Company Wholesale Groceries.

And my father grew up here, he was actually born in Des Moines, Iowa. And he grew up here. He was born in 1926, I think, so Anchorage had maybe, I think, 1500 people.

He -- he talks about Fox Farms that were on 15th Avenue, and the dairy that was in Ship Creek, or wherever it was, and all those things.

And he met my mother at the University of Washington, they got married, and they moved up here and had some kids, five kids. Two sets of twins -- actually, three sets of twins, but one didn't make it.

And so I grew -- I was born in -- like I said, in 1953. Grew up here. Anchorage, I think, had under 50,000 people at that time.

Went to grade school here, Chugach Elementary School, which was kind of a temporary building for World War II.

And Central Junior High and West High School, graduated in 1971. And went to University of Oregon where I got a Bachelors Degree in Business Finance.

I had -- of course, my father had built -- my grandfather and my father had built up the wholesale grocery business,

and he then joined with Larry Carr and start -- first started doing real estate together. Aurora Village was the first -- first real estate.

And then they eventually -- they merged and became Carr Gottstein, the Carr's Food Centers, and J. B. Gottstein Wholesale Groceries, and then the real estate.

Section 2: It was always kind of assumed that I would go to, you know, get a business degree and come back and work in the business.

And one of the required courses for college was business law, and I took it, and I didn't miss a question for the whole class. And I thought, hmm.

So I took the advanced business law, and I did miss a question, but I realized that that was something that I, you know, really had a -- I think, an aptitude for.

I went through the University of Oregon in 3 years, averaging 21 hours a term, not going through summer school, which I think helped me get into Harvard Law School;

that, plus being a sky diver. And so then I went to law school, and I took a year off between 1977 and 1978 -- well, actually, '76, '77, I think it was, that was to --

for various reasons, but that was right as the pipeline was finished being built.

And there was a -- a lot of people don't remember this, but there was a little bit of a recession because there was the construction boom, and then when all of that construction finished, there was a little bit of a recession before all the, you know, oil money started flowing.

And I came back to help my dad with -- you know, the business with that part.
And I -- that experience basically made me think that maybe it wasn't such a good idea to go in the business.

It was crowded with the Carr kids and our kids, and all that, and then, you know, I realized that my dad wasn't really ready to -- to give -- you know, give up control and stuff.

Section 3: When I graduated from law school, I went to work for Bob Goldberg, Robert M. Goldberg, who was Justice Arthur Goldberg's -- U.S. Supreme Court Justice Arthur Goldberg's son.

And we called the Justice the ultimate senior partner. And I -- I didn't have that much interaction with him, but I -- I did have some conversations with him. I met him a couple times, talked to him on the phone. And you know, I cherish that. He was quite a guy.

Bob -- Bob himself, of course, is quite a guy. And I think, it's fair to say, he kind of had to get to the way other end of the country in order to really establish himself.

And with Bob, I worked a lot with Ahtna, Inc., the smallest of the 12 regional corporations, and that's where I first met Lidia Selkregg and Dean Olsen who is a Professor of Business at UAA.

And they were terrific advisors to Ahtna. And for a long time, Ahtna, as a result of their help, was the only Native corporation to have never suffered a loss.

And I credit Bob, the team of Bob, Lidia, and Dean Olsen for, you know, helping them set that up.

We had a big case against Alyeska Pipeline where Bob, who was just really brilliant, Ahtna was the only Native corporation that owned pipeline right-of-way land, it owned 55 miles of pipeline right-of-way land.

In fact, I think that was holding up the construction of the pipeline.
And Bob negotiated a contract that we called the Omnibus Agreement where -- which provided for payment for use of the land, and then contracting and employment opportunities for Ahtna shareholders.

And they had a contractor there.
And so there were really two disputes that -- that happened with Alyeska. One was over payment of the land.

And that was really kind of a mini Mental Health Trust thing where there were a number of parcels, and I actually used an Apple 2 Plus.

Section 4: BILL SCHNEIDER: So we're talking about the Ahtna settlement.
JIM GOTTSTEIN: Yeah, so what -- there were two things that happened. One was this contracting opportunity, and the other was the payment for the -- the use of their lands.

And the Omnibus Agreement provided for both.
And it said that with respect to the contracting, that Ahtna would -- had an absolute right to do contracting it was capable of --

this is -- I believe this is accurate -- on the 55 miles of its right-of-way, and could bid on other contracts and would get it as long as it's, quote, reasonably competitive.

And they had -- they -- they formed a joint venture with, I think, Meridian Contracting, and it was a union contractor, and I think at some -- this is what -- kind of what I heard later -- is that they wanted to get rid of the unions, and they had a --

Ahtna had a catering -- I think catering for sure and maybe security contract for the pipeline and then they lost it. And that, Ahtna arbitrated. There was an arbitration clause in that.

And I remember vividly we had this arbitration hearing -- and I did a lot of work on it arbitration hearing at APU, it was APU, UAA. And it was a beautiful spring day and you could see the Alpenglow on the Chugach Mountains,

and we had this hearing between the -- in front of the arbitrator, Michael Heyman, I think his name was.

And Alyeska was putting up their figures on how they calculated the contract. And Dean Olsen and I looked at each other and thought, well, this doesn't seem right, and we went back after it and -- and looked at it and they had made a mathematical error.

And -- so that they had Ahtna's costs being much higher than it was really supposed to. And that's what knocked it out.
And -- and there was some reason why we could tell -- we had some documents that we could tell they knew about that.

And Bob did an absolutely brilliant cross examination of their witness. And and I came -- and we wrote the -- and led this guy --

what was his name, Stoltz or something, and led him down -- you know, down the primrose path, and then just chopped him off at the knees when he came to that.

And I remember the lawyers for Alyeska getting up and saying, oh, we didn't know anything about it, dah, dah, dah, dah. Well, needless to say, they settled shortly thereafter.

And we -- I came up with -- with our post hearing brief before they caved is we put in the brief the phrase "falsus in unum, falsus in omnibus," which is an old evidence term meaning that it's -- if someone testifies falsely on one thing, then you assume they can't be trusted to testify truthfully in other things.

Section 5: So that was one of the two major things that I did with Bob. And the other was this land valuation. And this was another place where Bob was brilliant because he had set up another arbitration where Alyeska would appraise it and Ahtna would appraise it, and then the final appraise

I don't know if there was a third appraisal or not. I forget about that. But the final determination was an averaging, which is fairly unusual. And so I worked on that appraisal.

In fact, I kind of -- we got Al Olsen to appraise certain parcels, and then I put together these appraise -- you know, these books for the rest of them, and Herb Smelcer was their land manager at the time. And we put those together.

And I put together this spreadsheet with -- with Apple 2 Plus that required piecing together, oh, I think at least four different spreadsheets, you know. Kind of pasted them together and then blew them up.

It was this big, long spreadsheet.
And -- and then we put this book together and gave it to Alyeska, and I think their -- their appraisal was something like a half a million and ours was four and a half million or something like that.

And then we said -- we put this book together, we had these overlays, and then we said -- well, we didn't even talk about the value of the loss of access to subsistence. And then we ended up settling for about, I think, a million and a half, which was our target number all along.

And that was part of what Bob called total client service.
And -- well, actually, that -- that was for not really just the legal stuff, but -- but other you know, other ways of working with the corporation.

Section 6: And I got -- he got a -- he, I think, was on a contingency. This was in 1982. And I got a chunk of that, and I left the law firm at that time, I -- this was from '78 to '82.

And during this time, fairly recently before my mother became the exec -- and my parents had divorced by now -- became the Executive Director of the Mental Health Association, Alaska Mental Health Association.

And Lidia Selkregg was a good friend of hers and knew about the state, basically, not managing the Mental Health Trust lands properly, and in 1978, essentially, formally stealing it when they passed a law basically saying, well, this is state land and pretending to promise to pay for it.

And they had gone down to Juneau to tell the legislature they couldn't do that. And they passed that law in 1978. And they tried to get them to change it for a few years, and were finally told, I think, by Senator Jay Kertulla, well, we don't care if it's illegal, sue us.

And I -- and that was right when I had left Bob Goldberg's firm. I was then setting up my own law firm. And I had started running for the legislature, and I took a trip to Europe right at the end. This was right about May and early June.

Came back jet lagged out, way behind on doing the campaign, and my mother asked me to draft a complaint for the Mental Health Trust litigation.

And I was working on that.
But I came back and I was jet lagged out, I had all these things to do, and I had never really experienced a situation in where I couldn't do what I was really trying to do.

I'd gone through college in three years by, you know, really having a very heavy load.
And I didn't get sleep for days, and became psychotic, which basically is a fancy word for crazy,

and I went over to my dad's house to -- to try and get some sleep. Because anybody who doesn't sleep for long enough will become psychotic. You know, it's one of the things they used to do in the Korean War to brainwash you is sleep deprive people.

Anyway, anybody will become psychotic if they don't sleep for long enough. Some people tolerate lack of sleep better than others; I don't tolerate it that well.

And I had just laid down and just barely closed my eyes and I heard someone. And I was in my dad's bedroom on the second floor and I heard someone coming down the hall, and I thought the devil was after me.

And I went over to the window and I looked down, remember looking down, and there was a -- the lawn there and there was a sidewalk that I figured, well -- and I'm in my underwear, by the way, and it's like 2:00 or 3:00 in the morning or something like that.

And I thought, well, I know how to do a parachute landing fall, and so if I can just miss that sidewalk and hit the lawn, I'll probably be all right. And I did.

I executed a perfect parachute landing fall and ran across the street into the parking lot at Central Junior High School, whereupon I was basically captured by -- I'm not sure who, but I was hauled off to API, to Alaska Psychiatric Institute, in a straitjacket.

And I was -- I think I would kind of describe it as a Whirling Dervish at that point.

Section 7: And they gave me some injection, which maybe I hadn't even thought about it, but in retrospect, may have been Haldol. I don't know what it was.

But it put me to sleep. And I remember waking up and in the bed, and there was a -- you know, some kind of nurse or something, a man, at the end of the bed in a chair with a clipboard as soon as I opened my eyes, and he asked me, what day is it?

And I asked him, how long have I been asleep?
And he wrote down, doesn't know what day it is.

And that's kind of the way it is in the hospital. And so that meant I wasn't oriented to, you know, date because I didn't know what date it was, which is a sign of, you know, mental illness.

And I used to do -- I used to -- at that time, I used to have this joke that I would say fairly frequently that I thought it was ridiculous to tie a rope around your neck every day, referring to a tie, and of course, they wrote down that a tie -- that I think a tie is for committing suicide.

Those that believed I was a lawyer said -- told me I would never do that again. And I was resistant, I was in denial about that, which I think ultimately is a good thing because if you accept that, then -- then you really don't have any hope.

And I think that's one of the real problems with the mental health system is that they think their main job is to convince people they will never get better, and that's just exactly the wrong thing to do.

But I didn't accept that. I was there about a month. I -- they gave me -- I could go into this more, but I won't. They said, well, we want to give you medication.
I said, oh, I don't want Thorazine.

They said, no, this isn't Thorazine, this is Mellaril. Well, Mellaril is just exactly like Thorazine, it's just another manufacturer.
They said, if you don't sign in voluntarily, we'll get a court order against you.

And I did have -- you know, they committed me involuntarily, and I actually had enough presence of mind to say, well, I don't really want -- you know, decided I don't really want this on my record.

So I signed in, but it was hardly voluntarily. But I was only there for a month.
And, you know, my family had a lot of resources but they didn't really know what to do.

And even my mother, being the Executive Director of the Mental Health Association, it's different when that happens to your family.

And so I was actually sent to psychiatrists in New Rochelle, New York, which is where, you know, Dick and Laura Petrie lived on the Dick Van Dyke show. I don't -- anyway, just as an aside. Very nice guy, Harrison Peck -- or Harris Peck.

And he diag -- I was let out of API with a diagnosis of atypical psychosis, and Harris Peck gave me a diagnosis of bipolar disorder.
I came back and I went into pretty serious depression at that point. And couldn't get off the couch for months kind of thing. And dah, dah, dah.

Section 8: My dad arranged for me to work for the law firm that he -- you know, did a lot of work for his company, which -- you know, which is great.

And I worked with a terrific lawyer by the name of Stan Reitman, who I only really ended up being there for nine months, but it's had a lasting impression just in the way that he insisted on certain quality of work and a way of clarity of writing and those things.

And I don't think I really meet his, you know, standards that much, but I -- I -- it really has had a lasting impression on me, even though I didn't work there that long. So dah, dah, dah, dah.

It turns out that there was some reorganization, and the -- and it became obvious that I really would be better off if I worked for the company. So I ended up going in house -- well, let me back up a little bit.
When I, you know, had my episode, I had to give up the Mental Health Trust case.

BILL SCHNEIDER: Oh, I didn't realize that.
JIM GOTTSTEIN: I was working on the complaint for the Mental Health Trust case at the time.
BILL SCHNEIDER: That your mother had asked you?

JIM GOTTSTEIN: Yeah. And I was actually drafting that complaint when -- and I was a pretty rookie lawyer at that point. I mean, I had only been out for four years. And -- but when I had that episode or breakdown, I had to give that up.

And that -- and that's when Steve Cowper was recruited to represent the Mental Health Association. He had been in the legislature, and then he was subsequently to become Governor. But in between, he represented the Alaska Mental Health Association.

And I -- but he named Vern Weiss and Carl Hilliker as his clients.
So where was I? So
BILL SCHNEIDER: Go ahead.

JIM GOTTSTEIN: So I was -- so jumping back, this was now 1984, I think. '83, '84. And I -- I worked in -- as in house counsel at Carr Gottstein and did stuff, but one of my deals with --

I had a by that time, I had already gotten back in the Mental Health Trust case.
There -- there had become a disagreement between Steve Cowper and the Mental Health Association over whether or not the -- the plaintiffs in the Mental Health Trust litigation should release their claim to lands that were also claimed by Salamatof Native Corporation.

And Steve was going to do it and the Mental Health Association said not to, and then he said, you're not my client, Vern Weiss is.

And so then the Mental Health Association decided it want -- you know, it wanted to intervene. And I was actually back working with them at that point.

And So then I moved to -- for the Mental Health Association to intervene, and I was the attorney at that point for them.

And my deal with my dad, working in the company, was that I took a reduced salary and was able to work on that case.
Well, things kind of got out of control and -- on the case and stuff.

Section 9: Well, I really ought to back up a little bit. During that process, I had gone through a couple of psychiatrists, and I didn't really like any of them, but then I -- I got --

and it was my mother who hooked me up with Robert Albert, who said, look at, you just got sleep deprived, there's no reason why you shouldn't be able to fully recover from this and go on. And then he gave me some medication really to get me to sleep when I needed to.

And what happens with me is if I'm working on a project or projects and I'm on a deadline and I have a lot to figure out, I just can't stop thinking about it, I'm working on this problem, and I just can't go to sleep. And if I do that for long enough, then -- then that's bad.

I have this saying that, you know, being half manic ain't all bad, but being all manic is not good.
So -- anyway, so I got into a situation, I -- I was actually in front of the Supreme Court in our intervention where -- and I was in Juneau.

In fact, I think that's probably where I met George Rogers at this meeting when there was kind of settlement negotiations going on.
It was after Steve Cowper had won the first Weiss decision, and we were fighting to get in the intervention, and then there was this -- these kind of negotiations going on. Bill Sheffield was Governor at the time.

And I had -- I had got into this sleep deprived point again, and had a second psychotic, you know, manic episode. But this time, I had Dr. Albert, and I went to Providence instead of API, got straightened out, really, within a couple of weeks.

And my father, at that point, said, you have to give up the Mental Health Trust case or quit quit working for Carr Gottstein. So I set up my own law office in 1995 and started -- and he gave me some work, and I did -- continued with the Mental Health Trust case.

But also, the bulk of my practice at that time was really business and commercial type of work, real estate, commercial transactions, that kind of thing. I've always represented at least one Native corporation.

Tanacross, up by Tok, is the one I've been representing the longest from, really, those days until now -- until -- well, no, I didn't start representing them until later.

I actually have the -- the best real estate deal I ever did was for Tanacross. And I -- I represented MTNT for a while, which is the merger of McGrath, Takotna, Nikolai, and Telida.

Anyway, so after that, the Supreme Court let us back into the Mental Health Trust case, and that was really, I think, in January of 1986. And that's, really, I think, I don't know, when -- do you just want me to keep going?
BILL SCHNEIDER: You're doing great.

Section 10: JIM GOTTSTEIN: Okay. So the Supreme Court decided -- I forget exactly when, it was in 1985, I think -- the Supreme Court decided the first Weiss case and remanded it.

And then in 1986, we all got together with -- you know, with the state and -- and we agreed that the Interim Mental Health Trust Commission should be established to make a recommendation of how to resolve it.

And that law was passed in -- was that in 1986? Yes. And George Rogers, Dr. George Rogers, a brilliant Juneau economist, was appointed.

The plaintiffs -- the original plaintiffs got to appoint one, and we were called the intervenors at that point, got to nom -- you know, nominate or appoint one.

And at this time, David Walker had taken over for Steve Cowper. And then the state had a representative -- and they -- they came up with a recommendation for a process for the land to be valued, and -- and then the state would basically pay for it.

Set up -- actually set up a real trust administration and pay for it.
And, I mean, I don't want to -- do you want me to talk about the Mental Health Trust land?

BILL SCHNEIDER: I -- in terms of your involvement.
JIM GOTTSTEIN: Well, okay. So in any event, the Interim Mental Health Trust Commission made a recommendation for the land to be valued, and then the state basically set up a real trust administration of the money.

And the trust was -- under the Federal law was to be used, first, for the necessary expenses of the mental health program. And the idea was then that money would be available for that, and the idea of the original trust was for the land to make money for the program.

And so this would just really be -- was seen as a clear way of doing that.
Well, we worked on that. And that was passed in 1987. And we worked on that a lot. I mean, we were valuing a million acres of land and it really involved a lot.

We set up some computer systems and things like that. And it -- it really was quite -- quite a deal. In fact, I have now given the original maps and stuff that we had for doing that to the archivist at the University of Alaska.

Section 11: But what ended up happening is that the state balked at the final number, which was about $1.1 and a half billion dollars.

And just said, we're not going to do it. And they -- this was in 1990. And they passed this law that said we're just -- we'll just devote 5 percent of the state's general fund to the Mental Health Trust, and what -- you know, if the -- oh, I think, yes.

The original bill was that you value the land and then the state would pay 8 percent that value. And the concern -- a year. And I think it was probably inflation proofed and all that.

And that the concern was that this -- you know, it might end up being more than the state could pay. And I think that was a reasonable concern.

And so they passed this law that said we will pay 5 percent of the general fund for -- you know, instead. And I remember telling people that they would be, you know, nuts not to take it.

And -- but there was this real -- this outrage, including by Dr. Rogers, at the way that they had been treated by the state. And it was rejected.

And so in the litigation, we filed for -- well, to back up a little bit, the interim Mental Health Trust Commission had been authorized, empowered to make decisions about interim management of trust lands, and they had to approve stuff.

And they were regularly approving proposed land transactions based on the assumption that the state, in good faith, would complete what was called Chapter 48, that was the name of the legislation.

And when the state refused to accept the valuation, they said no more land transactions.

And the state said, well, we're not going to pay any attention to you, and we went into court and got an injunction stopping any land transactions.

Section 12: And -- and so at that point, that created a pretty big problem for the state. And because there were a lot -- this was the -- the -- in -- in a lot of ways, the most valuable land in the state, you could qualify that a little bit, it was selected between 1956 and 1966, and so it was before statehood, and people didn't know if Alaska would become a state.

And they -- if so, they didn't know how much land the state would get. And so they really did a good job, Phil Holdsworth, of selecting the land. And they selected urban lands, they selected resource lands, such as timber, oil and gas, coal, minerals, and they did a very good job.

And so even by 1956, for example, most of Anchorage had already been taken up by other land, but there was 4,000 acres in Anchorage, which is, you know, a lot of land.

And what tended to happen in Southeast was that there would be the core -- core area that was taken already in 1956, and then the trust would select around it, so there was kind of this doughnut effect in Southeast.

And then land was selected in the Interior around Fairbanks, and resource lands, such as the whole -- a big chunk of the Beluga coal fields, oil and gas lands on the Kenai, a lot of lands in the Susitna Valley, Mat Su Valley.

Timber lands in Southeast. Most of the Chilkat Bald Eagle Preserve, and is it the Tongass State Forest? That's -- I don't think it's called the Tongass, for the state forest. But anyway, the state forest, and then the preserve. Most of that was trust land.

Section 13: So anyway, we got an injunction against that, and that really put a lot of pressure to settle the lawsuit.

And in 1991, we negotiated a second settlement, which was called Chapter 66, which this was during the Hickel administration, and Charlie Cole, the Attorney General, and Harold Heinz, the Commissioner of Natural Resources, we negotiated it.

And it provided, basically, for the reconstitution of a land trust, where we would figure out what land could come into the trust, what land wasn't going to come into the trust, and then figure out, you know, replacement land to put in the trust on a -- on an equal value basis.

And that took a pretty long time to put together, and opposition built -- built to that over time. And -- and not all the plaintiffs really wanted to be in the land business, they wanted -- you know, they wanted just the money.

And so -- and so -- so the plaintiffs were divided on that ultimately, and the environmentalists and the developers actually got together to oppose this because environmentalists didn't -- you know, didn't like land going into development status,

and the developers didn't like the idea of having to pay, you know, fair market value for the use of land. And they basically killed that deal.

And Charlie Cole really -- and Harold Heinz, you know, the last year of Hickel's administration, lost their jobs, I mean, over this. I mean, they -- I think they -- they weren't fired, they quit over it.

Well, what happened is Harold Heinz left and Glenn Olds became commissioner, for a while, of natural resources, and then Harry Noah was appointed, and he basically overruled Charlie Cole, who then quit.

And so then they pushed through the current -- the settlement that ultimately worked, which was to put back, you know, as much land, basically, as -- as was -- could be agreed to.

And the basic rule was any land that was objected to didn't go in, and then $200 million in cash to compensate for the land that didn't go in. And there was original land and replacement land, some of which was subsurface only.

Section 14: And as an aside, I mean, I ended up opposing that, David Walker and I, for various reasons. But I think everybody agrees that through our opposition, we actually bettered the settlement.

And I can -- one of example is that a lot of the municipal entitlement, what they called municipal entitlement lands in Kenai and the Mat Su Borough were Mental Health Trust lands. But the municipalities only got the surface estate of that.

And I said -- and when they proposed a settlement to the Court, we really objected to lots of aspects of it. But one of them was there's absolutely no reason why the trust shouldn't get the subsurface of these lands that the state still has a subsurface of.

These were original trust lands.
And so the lands in the Kenai underneath municipal lands are the subsurface, or mineral estate, is in the trust, and we said the same thing for the -- they wouldn't give us back the Point MacKenzie Agricultural Project.

And the reason for that, really, I think, was that the State Division of Agriculture was unwilling to acknowledge at that point that was a failed project, and they -- they really needed to write off all those loans that they -- they had made.

And if they -- if we had gotten it back, they would have had to really recognize that.
And so we didn't get that land back, but we got the subsurface of that.

And the Susitna Game Flats Reserve is right next to that, to the west, so we got the subsurface to that. And that's all good coal land there, especially coal bed methane.

And in fact, I've been trying to suggest to the trust land office for years that that's a place where you could really -- you really ought to look at coal bed methane because you don't have the you know, all the people there to complain about it.

I mean, it's really pretty much wide open land.
And actually, I think -- and I've suggested that maybe they could use the land under the farms to get gas to provide, you know, cheap heat and really do some greenhouse stuff there that -- that would work. But anyway, no one's done that.

And we got a big chunk of the Beluga coal field. And I'm convinced that there's oil and gas, oil and/or gas under some of these lands, and that at some point, that the trust really will -- will kind of strike it rich with that.

Section 15: So the other key feature of the settlement was the creation of the Alaska Mental Health Trust Authority.

I prob -- I skipped over this -- this area where -- or this process where three other groups were recognized as beneficiaries of the trust.

The case was started for what would normally be considered, classically, people that were diagnosed with mental illness, and then lawyers, Jeff Jessee, representing what's now called the developmentally disabled came in to say that they should be part of the -- the trust.

Because to back up even further, the reason why the land, the Mental Health Trust lands was given to the state was that Alaska was prohibited from -- the territory of Alaska from enacting any laws on mental health. And it was a Federal issue.

And if someone was, you know, acting crazy and creating problems, they would be charged with a crime of being an insane person at large, and if convicted of that crime, they were hauled to what's called -- a hospital called Morningside in Portland, Oregon, where basically they were left forever -- you know, forever. And that was really upsetting to people in Alaska.

And so there became -- it was a big issue at that time. And there became a big effort to give Alaska the authority to enact laws for -- you know, for its own mental health laws. And then the trust land was granted in order to help pay for that. So it was a package deal. Okay.

So when Jeff Jessee representing the people -- and there was another guy, Cooper Garrity, who really was involved at that time, too, but it really ended up being Jeff, they came in and said, hey, you know, they --

people with developmental disabilities, which they were called mentally retarded or mentally defective at the time, they were taken to Morningside Hospital, too, so we should be part of this trust.

The same, then, there was people representing chronic alcoholics with psychosis, Nugen's Ranch, which serves that group of people, filed to say, well, our people were the same type of people were sent to Morningside, too,

and then also elderly people, senile people with Alzheimer's disease and related dementia also.
And the Court ultimately decided, yes, all four groups should be in.

Section 16: I skipped over the whole mental health board thing. Anyway
BILL SCHNEIDER: Authority.

JIM GOTTSTEIN: Huh? Well, no, the Mental Health Board is before that. In 1987, when the first settlement was proposed --

no, I think it was 19 -- anyway, it was either then or 1990 when the 6 percent -- or 5 percent was kind of proposed.

The Alaska Mental Health Board was given the authority to recommend what -- you know, how -- what the mental health program should be like. And so it really kind of was a pretty powerful body, an important body.

But in the settlement that happened in 1994, the mental -- the Alaska Mental Health Trust Authority was created, and the land was actually to be managed by the -- by DNR. And that was actually a bone of contention with us.

And -- but the trust was given the authority to spend the income from the earning -- you know, from the trust, without the legislature having to appropriate it.

And in addition, the trust formally makes recommendations to the legislature and the Governor about what the mental health program should be, what the state should pay for, what -- and then, of course, what part of it the trust should pay for.

And the Governor has to explain in a report why it's -- why the Governor is not following the trust recommendations, and the legislature has to do the same thing.

And so that's a very powerful tool. And the trust, I think, since then, has actually been very brilliant at leveraging the relatively small amount that it's had available into being very influential

and being an agent for change far beyond the amount of -- you know, positive change far beyond the amount of money that it -- that it has available. And the trust sees itself as an agent for positive change.

Section 17: And it really has developed a, you know, kind of culture, a corporate culture, if you would, of being concerned about its beneficiaries and their lives, whereas --

so they're concerned with is what we are doing helping our beneficiaries. You know, are they -- you know, is their health good, are they getting jobs, you know, are they happy, that kind of thing.

Whereas the normal bureaucracy looks at it a little bit different. I mean, that's what they are trying to do, but they look at it more of, you know, are we providing this service, are we providing that service, which is really a different thing.

And so they get -- you get measured by, you know, how many people you serve, you know, what kind of services you're providing, rather than how the -- you know, the people are actually doing.

And that really is a -- is a fundamental difference, and the trust being focused on that is hugely important, I think, and hugely beneficial to the mental health program in Alaska.

And they've been willing to go out and try new things and -- and they have this philosophy that they can't really fund normal -- you know, they --

what they don't want to do is just replace state funding because right now, I think they have about $20 million a year, and probably the mental health program is, I don't know what, 150 million, 200 million.

So if they put money into regular mental health services, then the state just reduces it by that amount, and so that -- they don't see that as a benefit.

And so their idea is that they will only provide kind of startup money. And they call it -- that people need to get -- have an exit strategy where they will have ongoing revenue.

And I think when the Hickel administration put the -- put the trust -- you know, put this settlement together, but the Knowles administration really came in right -- right at the start of that.

I mean, this happened in 1994, and Knowles came in, in December of '94. I think that's right.

And so the first eight years of the trust was under the Knowles administration, which was very supportive of social service funding, generally, and mental -- mental health funding, and particularly, of course, Karen Purdue was a big part of that.

And -- and so the trust really had a partner with the administration in saying if the trust said the general fund should add this amount, the trust will put this amount, and the general fund should add this amount,

the Knowles administration, you know, they wouldn't just automatically go along with it, but they were basically supportive of that. And of course, the legislature was the other party, and didn't necessarily support it.

But basically, the idea of moving people from trust funds to general funds kind of worked.

And then the Murkowski administration came in, and not only was adding anything off the table, they -- they really cut things.

And so the idea that any program could really transition to the general fund during that period really didn't work that well.

And of course,now we have a new era with the Palin administration, and we have yet to -- yet to see that.
So that's -- that's kind of the trust thing.

Section 18: And I do think -- and I want to talk a little bit about one other thing, which is it's --

since 1955, when Thorazine, the miracle drug Thorazine first came on the market as, you know, kind of the radically improved treatment for mental illness, especially schizophrenia, the disability rate for mental illness in the country has gone up sixfold.

That's on a per capita basis. And what's happened is that the use of medication has so permeated and taken over mental health treatment that it's excluded everything else.

And these drugs actually -- you know, I know people who find them helpful, but -- and they should have access to them, but they are not for everybody, and in fact, there's pretty good evidence that these drugs are doubling the number of people who don't get better.

And that -- and that there are other drugs that cause people to become psychotic. For example, especially the newer antidepressants that are called the selective serotonin reuptake inhibitors.

There's a pretty substantial percentage, close to 10 percent, that will become manic and psychotic as a result of taking this -- these antidepressants.

And then they get diagnosed as being bipolar, then they get put on the bipolar drugs, and then they end up -- and those cause psychosis so they end up, basically, becoming permanently disabled as mentally ill when it was really the drugs that started them all along.

And so what I've been doing since about 2002, when I read this book called Mad in America, which put this whole -- all the -- the evidence together in terms of the research, that put this story together, is really trying to get other approaches as being possible, as being funded by the -- by the state.

And as a lawyer, I founded a law project for psychiatric rights whose mission is to mount a strategic litigation campaign against forced drugging.

And the idea there is that people should have choices other than drugging because we know that it's doubling the number of people who don't get better.

And I also started this program called Soteria Alaska, which is based on a non-drug program, or one that doesn't make everybody take the drugs, I should say, that really was proven effective in the '70s, and then basically got squashed by the pharmaceutical juggernaut.

And the trust that -- we've been working with the trust for years on that, and they support it and they -- they've looked at it and they said we're going to support it.

But we need to get the legislature and, you know, the state to make it as part of its program. And so right now we're in the legislature trying to get funding to get that program going.

Section 19: BILL SCHNEIDER: Let me ask you just one question. And then I'll let you go. You've been great, Jim. What -- what got your mom interested in this?

JIM GOTTSTEIN: Well, she's -- she was just a wonderful person, very caring. You know, believed in justice.

And Lidia -- she needed a job, basically, when she came -- after the divorce finally got finalized, and it took years and years and years, and she came back to Anchorage.

She had gone down to San Francisco to be with her elderly parents, and then her father passed away, and she came up with her -- moved back up with her -- with her mother, my grandmother. And she needed a -- she needed a job.

And so Lidia, who had been involved with the Mental Health Association -- Joyce Munson was the Executive Director, and she was just leaving, and -- and so Lidia said, well, why don't you become executive director of the Mental Health Association.

And it became -- really became her passion. And she was an indefatigable advocate for, you know, the mental health program as long as she was there.