Section 1: BILL SCHNEIDER: So today is March 11th, 2008. I'm Bill Schneider.
I have the pleasure today of doing an interview with John Malone. And Karen Brewster is here with us. And we're at John's house here in Anchorage.
And this, we hope, will be the first of maybe a couple of interviews. And so thank you for taking time to do this.
JOHN MALONE: Sure.

BILL SCHNEIDER: Great. Let's ‑‑ let's start by going back to your early years, where you were brought up and who your folks were.
JOHN MALONE: I was born and raised on the East Coast, New Jersey. I came to Alaska, like a lot of folks, by the Army. I had been a competitive shooter in the Army for several years, and I was assigned to the mark ‑‑ advanced marksmanship unit here, and got discharged here.

My first job, about two months after discharge, was with the new, then I believe it was the Division of Corrections. The Federal Bureau of Prisons had just turned over their system or were turning over their system to the state, right after the earthquake, 1964.
And so they were recruiting for correctional officers. And I applied for the job and was hired, and stayed there probably about nine months. We were trained by the Federal Bureau. They did a very good job of training us.

Then I was recruited there by a couple of troopers to make an application to the State Troopers, the then State Police. And I was accepted and hired by them. Went through my first academy in April of '65.
In those years, you had two academies when you were hired. One, when you were first brought in, and then you had your year of probation, and then at the end of your probation you had a second academy, and then you were, I guess, commissioned or accepted.

Spent a very ‑‑ a brief period of time in investigation. And that's probably the first contact I had formally with mental health. I think I conducted the first investigation of API .
There had been several complaints by people living in the proximity of API ‑‑ and you'd have to read the original or early literature of that hospital to understand how this came about. It was considered the ‑‑ the most advanced state hospital of its time.

One of the ‑‑ one of meanings in that was nothing was secure. And so patients could basically walk in and out.
And it was also at a period of time when patients basically had nightgowns, they didn't have street clothes. So finding them walking down the street, as a state policemen, I can remember stopping and picking them up.
And then people started to call in because a lot of times they would end up in people's backyards, and they couldn't get out of their backyards, so we would have to go pick them up.

Section 2: Some citizen or a group of citizens wrote a complaint to the Third Judicial District grand jury complaining about this ‑‑ these folks running around, wandering around the streets, I guess. And being the youngest investigator who was in investigation, I used to get those types of complaints all the time, and they would send me over there.
BILL SCHNEIDER: Uh‑hum.

JOHN MALONE: So I went to API and met the first superintendent, who was Francis Baumann. My remembrance of him is a brilliant fellow. He was a retired practicing psychiatrist who was a psychoanalyst. How he was chosen, I can't remember, but I had a fascinating time interviewing him and learning about basically hospital, hospitalization, mentally ill people. Remember, that was the only residential setting we had in the state at that time.

Under the 1956 Enabling Act, the feds provided the money to build that hospital, fund the program for 10 years, and then also the selection of the 1 million acre trust over 10 years.
And it was a Hill‑Burton Hospital, so it had an operating amphitheater, it had a morgue, it had everything basically that a general hospital had in it.

But I learned an awful ‑‑ an awful lot about serious mental illness and what was being done for it in those days.
Anyway, that ‑‑ that concluded that investigation, if you will.

Section 3: And then went on roving patrol. In those days before they sent you out to an outpost, one of the real remote outposts, they usually tested you out by sending you out on roving patrol. And I did Iliamna and Lake Clark first, and then I did the Aleutians.

And I think it was on my second ‑‑ my second trip to the Aleutians, and it used to take about ten days to two weeks to do the Aleutians. I was in Sand Point. And I think it was Wakefield superintendent, the one who was running Wakefield's Cannery at the time, wanted me to go check out these two gentlemen who had arrived on the airplane and were living under an overturned boat on the shore. And so I did.

And they had been our very recent ‑‑ recent, well, inmates, clients, patients from Morningside that had been returned to the state. And the state had returned them to their last known address.
One of their ‑‑ and one family had ‑‑ the mom and dad apparently was reportedly deceased, and the other family had returned to Seattle, or Anacortes, that area.
BILL SCHNEIDER: Yeah.

JOHN MALONE: So they were there by themselves.
But the most unusual thing about them, I thought, at the time, was that they both were carrying the same letters, written the same way, saying that ‑‑ I called them the Dear Mommy, Dear Daddy letters, here I am ‑‑ explaining who they were, where they had been, and they had medications with them, and if they complied with the medications, they were going to be just well young men.

Well, they weren't so young. One was ‑‑ one had been taking his medications, apparently, and was in compliance, but one had not, and he was really decompensated.
So anyway, in those days, of course, we, the State Police, exercised a lot more jurisdiction over a lot more people than we do today, and of course, that would have been one of those situations.
And so I brought them back to Anchorage. And one of them turned out to be a veteran, so he got to go to Elmendorf .

But I was quite curious about this letter system. And I had not ‑‑ I don't think in my interviews with Dr. Baumann the issue of Morningside Hospital outside had come up. In fact, I didn't really learn the history of Morningside and what had gone on in Morningside and how long the contract at Morningside would last until we got into the actual settlement.

But anyway, the one patient, the one who had been so decomp ‑‑ appeared so decompensated, was transferred out to Elmendorf. And the other one was admitted to API.

Section 4: And Dr. Baumann had since left API, and Dr. Carl Koutsky, probably one of the most influential physicians, I think he was a great teacher, I attended many of his courses a couple years later when I was back in here going to school, had just taken over the job as hospital administrator. I think he come up from the University of Michigan or Minnesota. He had been the hospital administrator on campus there at the medical school.

And he did, he did many, many significant things, including bringing the WAMI program into Alaska, and opening up the teaching of the classroom experience for the WAMI students to the university, so people in the university could enroll, and we all did. Anybody who was in the psychology program did.

And he stayed probably six years, if I remember. And also helped in opening the first residential facility we had in the state, which was in Spenard. Pretty controversial in its time. Typical NIMB, not in my backyard kind of controversy.
But again, he was a great teacher and became later a very close friend.

Section 5: I was transferred out to Bethel. Actually, I was asked to go out to Bethel to do an audit on the city jail.
In those days, the State Police contracted to several cities to be ‑‑ to do their city policing, and Bethel was one of them. Bethel also happened to be probably the worst one because it had a community liquor sales, it was selling liquor, it was selling liquor to the region. Almost a million dollars a year business.

And a lot of not so good things were happening there: drownings, homicide, suicide. And part of the policing duties that the troopers had was also administering the jail.
The problem was, of course, in our academy training, they trained us for a lot of things, but administering a jail wasn't one of them. And it was some real problems with the billing system.

And so anyway, I went through and I did this audit. And the city had slightly overbilled the State, but the contract that had been drafted, I assume by then by the city, and signed by the State, really left the city a lot of latitude as to how they were going to bill.

So anyway, that kind of ‑‑ my recommendation, I believe, to the commissioner at the time was that, you know, this is not something recoverable. It is something correctable, but not recoverable. And so that's what they did.
Well, I was getting ready to turn around and come back because I had come off the Aleutians after two and a half years, and they were giving me a summer sabbatical at Alaska Methodist University for school.

In fact, I was driving the Upward Bound bus, and about half the students on the Upward Bound bus were kids that I later met when I went out to Bethel, they come up the Yukon and Kuskokwim.
But the trooper who was supposed to take over that ‑‑ there were actually two troopers in that post, but the first one was being reassigned, his wife was killed in an automobile accident up in Fairbanks, when I was there, so they asked if I would hang around until they could, you know, fill ‑‑ fill in with someone permanently. Well, three and a half years later, about as permanent as it got.

And after that first year, the ‑‑ the new Commissioner of Public Safety had written to all the cities that had contracts, and I can't remember how many we had at the time, it wasn't very many of them, that they were ‑‑ they were getting quite a deal. I think they paid $12,000 a year for both of us, including our housing, vehicle, and everything else. And the cost associated with a trooper was just a bit higher than that, like $21,000 a year.

And so the commissioner's position was that, you know, State Police belonged to the citizens of the ‑‑ of the state, and if you wanted to have them exclusively in your jurisdiction, you were going to have to pay whatever the cost was, and here is the cost here in Bethel, $21,000.
Anyway, the city whined ‑‑ whined quite a bit, made two trips to see the Governor, they didn't get anywhere.

So the contract lapsed at the end of my year. That was the longest year I had ever spent, I think. So I agreed to stay on without the contract. And we agreed to basically solicit for them and train for them a new chief and police officers.

Section 6: There was a lot of issues with mental illness. There had never been ‑‑ the BIA at that time was the principal provider both of education and social services.
There really had not been a survey in the region of particularly mentally ill and developmentally disabled; the developmentally disabled in the school system, there hasn't been either.

During that time, one of the unfortunate things that was happening in the city, of course, is that there was a lot of alcoholism, parents getting drunk and kids not being able to come home, or go home.
So I was continuously confronted with this little gaggle of kids every night. And I used to put them ‑‑ the National Guard loaned me a bunch of sleeping bags, GI sleeping bags. And I had them ‑‑ I stacked them in the courtroom.

And in those days the courthouse and my office and the jail were all combined in an old what used to be the marshal's facility, U.S. Marshal's facility. The judge and court was up front, I was in the middle, and the jail was in the back. So that's where I used to bunk them out. And then when the meals came over to feed the prisoners, we always fed the kids, too.

Until one morning when the judge came in, it was a Sunday morning for arraignments, because we had arraignments seven days a week, she was obviously not in a good mood, and didn't like that because I hadn't got all the kids up yet. There were several of them still sleeping. She told me to do something about it. That was her classic response to problems, do something about this.

Actually, she's the one who did something about it. She called the BIA, she said, we need a building, we need a facility, we need some kind of concept, which are social workers, to put these kids to bed and oversee them, and all this kind of stuff.
And the superintendent of the BIA at that time ‑‑ well, her husband was working for the BIA. That's the largest BIA, by the way, in the nation, the Bethel headquarters.

They donated some space to us, an apartment space to us, and in very short order, we organized this little corporation called the Bethel Receiving Home, which later became Bethel Community Services, and went on for, God, I don't know, 30 years.
Became the mental health provider for the region, developmentally disabled provider for the region, brought the MDTA, the Manpower training facility down, brought the Adult Basic Education down for the community for a long while. Did the substance abuse program over the years.

It wasn't until about two years ago, three years ago, that with the past commissioner's decision to move state contracts into the 638 providers, that Bethel Community Services basically didn't have any contracts to service. They all wanted the health corporation.
Yeah. So it ‑‑ it went on, like I said, it went on for over 35 years. Maybe 37 years. And pretty successful.
Where am I with that?

Section 7: BILL SCHNEIDER: And so the BIA stepped up at that time.
JOHN MALONE: The BIA stepped up, and the BIA has stepped up in several occasions. The BIA did a wonderful job in helping us in the beginning. They eventually gave us a whole building.

We ran a ‑‑ we ran a summer diagnostics and evaluation clinic that the BIA paid for, up at a mine, a gold mine northeast of us, about 60 miles, called Nyac. And it had been abandoned for 10 years. But it had very nice homes in it, houses.
And so we opened up the summer camp, and the first cadre of kids that came through, there were groups of 20, were basically kids that the teachers had referred and thought should be evaluated.

They didn't know what for but they thought they should be evaluated.
So they ‑‑ they hired a ‑‑ I don't know if it was a psychologist, there was a psychiatrist, there was a nutritionist, I believe there were two or three social workers, made up a team, and processed these kids, if you will, through an evaluation process. It was the first time kids had ever been evaluated in that region.

We'd had a lot of bad results from kids who should have been evaluated and should have been treated. Meningitis was ‑‑ was one of the big ones. The Lower Yukon had tragic episodes of meningitis. And those kids, of course, the global brain damaging, most of those kids ended up ‑‑ well, not most, all of them end up in Harborview. We ended up bringing several of them back over the years, but... Yeah.

So that's ‑‑ that was the first screening that's ever been done. We did it two years in a row. The BIA, again, paid for the whole ‑‑ paid for the airplane charters, the ‑‑ paid for the food.
Even flew a big swimming pool up there in the second year that they had ‑‑ that, like the superintendent said, I'm getting tired of looking at that thing, nobody wants to put it together, so I'm going to fly it up there. It was a big one, like 30 some odd feet. That was pretty successful.

BILL SCHNEIDER: Were these for all kids that were screened?
JOHN MALONE: Yeah. This was for all kids. Yeah. All kids in primary, up through 8th grade. Because that's all the BIA supported at that time of up to the 8th grade. After you went to high school ‑‑ or to junior high, I'm sorry, you went down to Edgecumbe.
BILL SCHNEIDER: Yeah. So did they approach parents or how did that work?

JOHN MALONE: Yeah. Oh, definitely approached parents. Yes. It was through the parents first, that ‑‑ yeah, the child ‑‑ the release was signed and the child was authorized, if you will, to go to camp.
Yeah, again, that was the first ‑‑ that was the first actual evaluation of kids on a large scale basis in the region that went ‑‑ and it was very eye opening, the amount of disabilities that we ‑‑ that were uncovered. Also, tragically, incidences of neglect, unreported neglect. But anyway.

Section 8: BILL SCHNEIDER: You were still operating in a trooper capacity at that time?
JOHN MALONE: I was operating in a trooper capacity when we formed BCS. When I left the troopers ‑‑ I left the troopers, they made me the first executive director of that corporation, Bethel Community Services, and I did that for about a year.

And I ‑‑ and I wanted to return to school. Well, I had two reasons to return to school. One, my GI bill was running out in the year 8, and the year 8 was approaching, so I did. I came back in here and spent two winters, two winters and one summer, I believe, going back to school.
And then a good friend of mine who had been in the flying business out there wanted a partner, and asked me to come back out to Bethel and go in the flying business with him, which I did. And did that for another five years.

BILL SCHNEIDER: Tell us a little bit about your schooling before we get to the flying.
JOHN MALONE: Well, I was interested in two ‑‑ primarily two subjects, one was business and the other was behavioral health, which was psychology in that day.
I was very fortunate having met Dr. Koutsky and known Dr. Koutsky earlier on. He allowed me to, basically ‑‑ I wouldn't say attend a residency, but attend trainings at the hospital like a resident for a year.

And, well, let me see, how can I say this gently. He wasn't overly impressed with the curriculum at the university.
BILL SCHNEIDER: This would be UAA?
JOHN MALONE: Yes.
BILL SCHNEIDER: What became UAA?
JOHN MALONE: Yes. He had ‑‑ but, however, he had hired one, I thought, exceptional person, a psychometrist was Linda Bilsabick (phonetic). I don't know if you remember her from ‑‑ she was one of the first candidates when I opened up the doctoral program on psychology up at the ‑‑ on the Fairbanks campus.

There was seven of them, I believe, that were accepted. They all ended up arriving, and then the university shut it down and didn't put it on, so they made some pretty ‑‑ pretty unhappy people. And she was one of them.
But anyway, Dr. Koutsky hired her as a psychometrist to do testing, and she was there for several years, and then returned to the campus in Anchorage and was teaching in the graduate program. She was an exceptional lady.

Yeah, and that was about it. I ‑‑ I guess, I don't know, I guess my ‑‑ my curriculum was probably split 50/50, between business courses. Most of them were in psych, though. Most of them were in psych. Anthropology. I've got 15 hours in anthropology.

Section 9: Yeah. So anyway, then I said, my friend in this flying business, got into this flying business and wanted a partner.
KAREN BREWSTER: I just had a quick question on the year, what year you left the troopers in ‑‑
JOHN MALONE: That would have been '70, 1970, the end of 19 ‑‑ I think it was December 1970, it was almost '71. I was going in ‑‑ I was in my sixth year. And, yeah, then came ‑‑ then came in here.
KAREN BREWSTER: Okay.

JOHN MALONE: And I think I was here five semesters. I think five semesters. I haven't looked at that in a long time.
BILL SCHNEIDER: So then you had this business opportunity.
JOHN MALONE: Had the business opportunity, went out there, yeah, and we got in and started with a ‑‑ operated on, in those days, of course, the Alaska Transportation Commission was in place, and you had state certificates, all operators had state certificates, and they were supposed to be based on need, which was kind of a joke, but ‑‑

so we ended up leasing, basically, a certificate from another operator who was not operating, and formed a corporation called Bushmaster Air Alaska. And flew that and operated that for five years.
BILL SCHNEIDER: Were you interested in flying?

JOHN MALONE: You know, it was kind of interesting. I had been a pilot, I learned to fly down in Kodiak when I was on the Aleutians. I probably did less flying when I was in the business. The only thing I flew was paper, flew a lot of paper, than I did when I was just a private ‑‑ private person. I did most of the business, business sides of it.

Section 10: And then the next thing I got involved with was, again, we stayed or I stayed when I came back, stayed with Bethel Community Services on the board of directors, I think I was on the board of directors like 12 years on and off, different.

And then they ‑‑ they ‑‑ we got some capital money from the legislature to build some buildings. Some of the projects we had opened up there were getting on in time, and the facilities were getting pretty run down, like the day care center. We opened the day care center there 1969. And it was a little log building the city donated to us, and had gone on for 8 or 9 years, and it was getting pretty run down.

So we built a new receiving home. The one I told you about earlier, the BIA building, we built a new permanent building for that. And we built a new day care center. It was pretty large. It was licensed for 114 children.

And we got into mental health services, residential. In fact, we built the first actual residential mental health facility that was designed to support the living for the mentally ill. In other words, it wasn't somebody's renovated house or renovated building, it was actually designed for that purpose, called the Bautista House, and it's still there today, being operated by YKHC today.
BILL SCHNEIDER: And was that the first in the state, do you think?

JOHN MALONE: It was the first one designed in the state they built that way. No, Dr. Koutsky had opened up or helped open up in Spenard the first supported living facility for the mentally ill. And I can't remember the lady's name who was actually running it.

We ended up ‑‑ interesting, I guess it is kind of an interesting tale, we ended up ‑‑ Bethel Community Services ended up providing services to the mentally ill, that level of service, residential service, because the woman who had been doing this, API had discovered that she would accept these folks, and the only income she made from them or got from them was the Social Security. It wasn't very much money.

And she ran a restaurant, had her own restaurant for many years. So she had a ‑‑ she had a meal food source, I guess would be a better way of saying it. But she got very ill. She became very ill. In fact, it ended up ‑‑ the patients that she was taking care of ended up taking care of her until she died. She died in the facility.
And it was pretty primitive. It was an Army quonset hut. There were lots of old Army buildings that the Army Air Corps had across the river when they had an air base there during the Second World War.

Slid across on the ice in the wintertime and brought to Bethel, this was one of them, big quonset hut.
But didn't have any running water, only had honey buckets, and there was 12 ‑‑ 12 patients in there. And about two‑thirds of them had been original Morningside patients.
BILL SCHNEIDER: Wow.
JOHN MALONE: One of the things you really noticed about those folks was their under‑socialization. Had very few social skills. And they were getting ‑‑

BILL SCHNEIDER: You mean face‑to‑face interactions and things?
JOHN MALONE: Interaction, appropriateness, taking care of themselves, hygiene. Yeah. Just about all of it.
So anyway, she passed away, and there was these 12 or 13 patients in this quonset hut that no one seemed to want.
So we had an emergency board meeting, to make a long story short, and we decided that we should probably, if no one else was going to do this, we thought somebody ought to step in and do this, and we were probably the only ones capable of doing it. So we did.

Actually, it was Judge Guinn who made lots of decisions for us that way, kind of going back to do something about this thing. So we did.
And then at that time, the state fire marshal, who was a pretty close acquaintance of mine, Andre Shaw, I called him and I said, well, I've got this ‑‑ I've got this little difficult problem here, I've got these people living in a pretty substandard hut, but however, we've been told that we're going to get ‑‑ and it was then Representative Holman, I believe, I don't think he was in the Senate yet, that got the funding for us, we are going to build a new facility, and we have the land, which we did.

And so we did. We built what's now referred to as the Bautista House, which was named after this woman who had passed away, Helen Bautista.
BILL SCHNEIDER: What's her name again?
JOHN MALONE: Helen ‑‑
BILL SCHNEIDER: Helen.
JOHN MALONE: ‑‑ Bautista.
BILL SCHNEIDER: Uh‑hum.
JOHN MALONE: And it was dedicated in 19 ‑‑ 1980. 1980.
Again, like I said, it's still operating. The Yukon‑Kuskokwim Health Corporation operates it under their behavioral health program. They have three facilities now for mentally ill, residential facilities.
But I don't know, where does that ‑‑ where does that leave us? We are in the 1980s, I guess.
(Interview paused.)

Section 11: BILL SCHNEIDER: ‑‑ at the Bautista House, and providing the services in ‑‑ in that way, and you said that there were two other houses.
And Karen, are you back on?
KAREN BREWSTER: Yes.
BILL SCHNEIDER: Oh, okay. Good. So then there were two other houses set up, I think you said, to deal with the mentally ill in ‑‑
JOHN MALONE: Developmentally disabled.
BILL SCHNEIDER: Mentally disabled, yeah.
JOHN MALONE: Yeah. Developmentally disabled, we called them.
BILL SCHNEIDER: Developmentally disabled.

JOHN MALONE: But again, this was kind of, Bethel Community Services brought an awful lot of services into that community that later entities that had responsibility for them, like the State, like the University, who would take them over. The Adult Basic Education program was one of them.

Substance abuse, which really the substance abuse program, when it was originally designed by the legislature was it was designed for, quote, for a community to operate it. They just didn't have the capacity in the communities to hire, train, and do things like that.
So BCS ended up doing a lot of these things initially, and then turning them over to ‑‑ like the substance abuse program was eventually turned over to the city.

And the Adult Basic Education went to the community college when it arrived. And Manpower training portion that we had from the university, when that was a federal grant, went to the community college also.
Yeah, we did a lot of those things. We had nine ‑‑ 1969, 1970 as far as leaving, I think we had nine programs operating.
BILL SCHNEIDER: Wow. Yeah. And your comments were very interesting about the returning of the Morningside people.

JOHN MALONE: Yeah. I had, again, knew so little about Morningside. And Dr. Koutsky probably was the only one who filled me in, but he had never been there physically. He just knew from the history.
As you go through this process of interviewing us that's been involved in it, I noticed you interviewed Thelma Langdon, but I understood that a lot of the records before the patients were transferred back to Alaska had been destroyed, there was a fire, and apparently all these records were destroyed, because we ended up with several patients that had undergone surgery out there, and we couldn't find any records of the surgery that happened. Back surgery was two of them that I remember.
BILL SCHNEIDER: Oh.

JOHN MALONE: And went through ‑‑ back through API and the BIA ‑‑ or the Public Health Service, and there was no record of these things. And was later to discover that, yes, it had happened, and it happened while they were there at Morningside, and that was part of the record system that they lost.
Turned out that I don't think we had any continuing records from Morningside to the patients that we ended up having at the Bautista House.
And a lot of these people, of course, what happened to them, the trip to Morningside ‑‑ you have to back up. I don't know if this is going back too far.
BILL SCHNEIDER: No, we're interested in that earlier period, as well.

Section 12: JOHN MALONE: Well, you have to go back to the ‑‑ basically to the Organic Act, 1912, or even before that, the Federal Government's decision that the Territory of Alaska was not going to have the authority or the probably didn't have the capacity, so it wasn't going to have the authority when it became an organic territory, the Organic Act was passed, to carry out services effectively for these type of people. Mentally ill. They were all mentally ill then.

So they entered into a contract with the sanatorium company in 1903 outside of Portland for space at Morningside Hospital. And in 1904, the first Alaskan arrived.
And then in 1912, of course, the Organic Act was passed, and the ‑‑ we were prohibited, the territory was the only territorial possession of the United States that was prohibited from both administrating, administrating and legislating a mental health program for its citizens. The Federal Government took over that total responsibility.

The tragedy that was never corrected through 53 years until the Enabling Act was passed in 1956 was the standard for being admitted to Morningside was a ‑‑ basically, a criminal standard. An insane person at large.
And children, of course, were in the same boat. If you were an adult parent and you had children that needed hospitalization services, basically, you had to go to the court, and that's the way they were petitioned. They were insane ‑‑ insane people at large.

In fact, the last two ‑‑ last two juveniles who went to Morningside, which was a year after the Enabling Act was passed, 1957, were two brothers who were juveniles, and they went under an order remanding them to the United States Marshal, as insane persons at large.

Why we ‑‑ why Congress would never address, if you will, a more humane way of addressing ‑‑ they certainly began to understand because there had been ‑‑ there had been studies or there had been surveys done at Morningside, we certainly had learned a lot in those 53 years about these illnesses, but they never changed the standard of what was the standard to get to Morningside.

And that was really a tragedy because what it turned out to be, after we went throuogh lists of folks that had been committed was it was a one‑way street, pretty much a one‑way street. It wasn't until the Enabling Act passed that they started returning them because they were required to.

Section 13: And, well, anyway, we got through the ‑‑ that period there. And of course, the Enabling Act created both the legislative authority, it appropriated money to build what became API, and that was completed in 1962.

And it also, because Congress understood that the new territory probably was not going to have sufficient revenues to administer a program, it had agreed to provide funding for 10 years, and the selection of what later became the Mental Health Trust, a million acres for the purpose of supporting the mental health program of the territory.

Well, I guess that's probably the time to get to Steve Cowper. Like when I was a trooper still in Bethel, it was not uncommon in those days for Bush troopers, we didn't have district attorneys, and so we did a lot of the functions of what a district attorney would do for you now, or an assistant district attorney.
We had to try our own misdemeanor cases, we had to handle our own arraignments, type our own complaints, handle our own preliminary hearings. And because of the volume of work that I had in Bethel, I got pretty cranky about that with the district attorney, who was then Jerry Van Hoomisen up in Fairbanks.

He had been U.S. Attorney here, and that's where I first met him, and then he became district ‑‑ state district attorney.
So anyway, to make a long story short, he calls me up one day, he said, I'm tired of hearing you complain about this, I have this young attorney that's arriving in the state and he definitely needs some TDY time. And that was Steve Cowper.

BILL SCHNEIDER: TDY?
JOHN MALONE: Temporary duty. Because you get a little extra money.
So he sent him down, and that's how we got to know each other, and became pretty much fast friends since then. We still stay ‑‑ stay in contact, but...

So when the Weiss case ‑‑ when he filed the Weiss case, we got in a discussion about, basically, mentally ill folks and developmentally disabled folks. And of course, he was briefing me on the history of what the ‑‑ the Enabling Act was. I had no idea what the Enabling Act was in those days at that time.
And he had little idea of the, if you will, the illnesses. They all ‑‑ what constituted developmentally disabled, what constitutes serious mental illness, and what the differences were.

I also had the good fortune at that time, we had a very difficult time finding a psychiatrist who was willing to contract services to us out there in Bethel. So my good friend, good acquaintance, Dr. Koutsky, had since left the state, retired, left API and the state, and gone to Klamath Falls, Oregon.
And I called him up and told him what my problem was. And of course, about every patient we had in there he was familiar with. So he, on a voluntary basis ‑‑ we paid, of course, his expenses and everything ‑‑ came up and became our consulting psychiatrist for these people for, I don't know, two and a half, three years.

He got a little tired of that, and he went and recruited us a psychiatrist, a very young psychiatrist. He said, I recommended this guy for his residency, psychiatric residency. And he just completed it. And he kind of implied on the telephone, he said, I'm not going to give him any choice, he's going to be your contract psychiatrist. And he was.

It was Dr. John Riggit (phonetic), a wonderful, wonderful practitioner, for nine years. I think he's the longest psychiatrist that ever was under contract in those days.
And he also took over the WAMI program in the state. So we had a WAMI student. We also had money that would allow him to travel with a WAMI student, which was very helpful.

Section 14: Getting back to Dr. Koutsky and Steve Cowper, I referred Steve to Dr. Koutsky as far as, you know, getting, if you will, tuned up on the expertise, more clinical knowledge of these folks. And I don't know whether Steve ever did or not. I know they ‑‑ I know they met and I know they talked, but I never heard much ‑‑ much beyond that.

But anyway, when the trial case, when the trial case was decided, and was that 1982, 1983? I think it was '83. '82 we filed, and I think '83 the trial judge, Judge Taylor, made the decision up there.
And then the State decided to appeal, and then, of course, 1985 was the famous Weiss Supreme Court decision. And that required the State to ‑‑ mandated the State to reconstitute with the ‑‑ with the setoff.

BILL SCHNEIDER: Let me ask you a naive question. Why do you think Cowper took that case?
JOHN MALONE: You know, I don't think we ever shared that together. When he ‑‑ I read ‑‑ I read Vern Weiss' version of how they got together, and I don't remember ‑‑ I guess I don't remember anything, us ever talking about that.

I think it was the Mental Health Association who was aware that these are trust lands and the State was abusing or breaching their responsibility as trustees. And I think it was them, if I remember, who brought Vern Weiss, or the family, the issue of that family, the son Carl, to Steve. And he was doing most of his work at the time, he just left the DA's office, and he was quite a well‑known trial attorney, because of his experiences in the DA's office, so he was working for other law firms who needed cases tried, and that's what he was doing.

He was in a very small ‑‑ 551 and One‑Half Second Avenue was his office. Interesting. So anyway, this was kind of a really interesting case for him to take on.
After he ‑‑ after the appeal, though, when the appeal was filed, and responding to the appeal, we had lots of discussions about that, because I, like most people, had very little understanding of public trusts and how they worked and how they should work and how this one wasn't working.

And he was ‑‑ and I still remember his comments about the State. He said, the State still had ‑‑ still doesn't understand this issue. They can't win this the way they are going about. They breached the trust. It's been breached.
And sure enough. I don't know if you ever read the actual Weiss decision, but it's a very, very brief decision. Basically, it said that, yes, Congress created a trust, it was a real trust.

What's common among trusts is that you have to have a corpus, every trust has to have a corpus, and you've breached the trust by dissolving the corpus; in other words, selling the land or re-designating the land. And so you basically dissolved the trust; you didn't have the authority to do this.

Again, I'm taking this out of the back of my head, but it was very ‑‑ I was ‑‑ I guess I've always been amazed at how brief the decision was, the original Weiss decision.
And of course, they included in that that the State was entitled to a setoff involving the amount of monies, funds that they had expended on supporting these that would later become the beneficiary class. And which became a big concern throughout the whole settlement process. And I think Judge Greene touched on that very ‑‑ yeah. A little bit.

Section 15: BILL SCHNEIDER: But it sounds like you might have been instrumental in helping to define those classifications.
JOHN MALONE: Well, what happened, sometimes you get ‑‑ sometimes there was a little ugliness involved in some of this. The ‑‑ and I have a great deal of empathy for Dr. Rogers. He just worked his fingers to the bone and he was not treated very well by the State, unfortunately, when he was going through this process.

He chaired the Interim Mental Health Trust Commission, which the legislature had charged to eval ‑‑ to bring in the values. And Dr. Lidia Selkregg was his other member. And there was a member from ‑‑ it was actually the division director from DNR who was the third member. And again, he ‑‑ he tired me out just listening to him. It was really a ‑‑ really a lot of work.

And you needed a ‑‑ my sense of it, I had been a real estate appraiser much later on in life, in the 1970s and '80s, not that type of real estate, not minerals and things like that. But just the amount of knowledge you had to glean to understand what ‑‑ you know, what the proper process and appropriate process was. It was quite a bit.

And again, he worked as ‑‑ just worked, worked, worked, worked, worked, worked. And he was no young fellow.
But we came ‑‑ finally came down that the commission, as you're probably well aware, finally came down with a determination, or a value, an opinion value, and the State rejected that, literally rejected it out of hand, and which sent everybody back to the drawing board.
And said, well, it was quite obvious that the State couldn't write a check for that amount of money. It was something up around $2 billion.

And I don't think the plaintiffs really expected that to happen. That was not. But we were sent back to the drawing board.
At that time, Steve Cowper had become our Governor, so he couldn't even say yea or nay in the case, anything about the case.

Section 16: And then we proceeded on to Chapter 48, and I think Judge Greene covered Chapter ‑‑ I mean, the ‑‑ the legislative attempts to settle that came along later, Chapter 48 being the first.
Probably the most significant contribution, I think, in Chapter 48, aside from the Interim Mental Health Trust Commission, was the Mental Health Board. They were given kind of the similar authority that now the Mental Health Trust Authority has, particularly in a budgeting process, which was extremely helpful, and a planning process.

My constituency, when I became state president of the Alaska Alliance for the Mentally Ill, my constituency, one of its biggest concerns and things that upset most family members was that there was so little in the state plan that addressed either consumers or families. In fact, I don't think the word "consumer" was even used in state land up until that time, 1990. And it became a bone of contention as we went on through the final settlement, too.

The Alliance wanted the plan removed from the State, taken out of the hands of the State, the commissioner's office, and placed in the trust. I didn't agree with that. So we had to come up with some kind of a compromise that would satisfy my folks and ‑‑ and keep some leverage, basically, on the plan through the Trust Authority.

And that happened ‑‑ actually, Phil Volland, our lead attorney in the final settlement, is the one that came up with the language that allowed the ‑‑ the plan was now to be developed by the state, by the commissioner, in conjunction with the Mental Health Trust Authority.

And I still remember this. He called me on a Saturday morning and talked this over because it was becoming an issue with my ‑‑ my folks, a real issue. He said "in conjunction with" has no legal definition, so you can work that out any way you want to.
And I said, well, that's a good ‑‑ that's a good one. Because we didn't know how we were going to work it out. We didn't know ‑‑ we didn't have a formal relationship between, again, the plaintiffs and the department and the plaintiffs and the commissioner. In fact, Margaret Lowe was the commissioner then.

And it seemed to work out when ‑‑ and both sides understood what the Alliance of the Mentally Ill's concern was about the plan. Basically, the families and consumers had been excluded from the planning process, weren't even mentioned in the planning process for years and years and years, and that was okay with them. And they wanted them brought back in, or wrapped into the plan.
(Interview paused.)

Section 17: BILL SCHNEIDER: ‑‑ resources, and the Cowper administration, and what was their relationship to the Interim Mental Health Trust?
JOHN MALONE: Well, they had a member, I believe he was the Division of Lands director ‑‑
BILL SCHNEIDER: Uh‑hum.
JOHN MALONE: ‑‑ on the commission with Dr. Selkregg and Dr. Rogers. And the three of them basically made up the commission, as I remember.

And their job, of course, was to produce a valuation report, which they did, and it was supposed to be approved by the commissioner then of Natural Resources. When the report got produced, she ‑‑ she would not approve it.
BILL SCHNEIDER: And that would have been Judy Brady at that time?

JOHN MALONE: Yes. And I can't remember exactly the language she chose and why she did not approve it. It pretty much upset all of us. It really did.
Aside from the fact that we were ‑‑ it was ‑‑ there was someplace in the vicinity of $2 billion. I think we were all familiar ‑‑ I mean, all realized that this was not an issue of the State writing a check for this.

But it was important, just from the Supreme Court language in Weiss, that the determination of the value had been made, and most of the pro ‑‑ I think all the processes we had gone through had been agreed to by both sides.
That's how we got into dealing with the process. It wasn't a unilateral decision on the commission side or the department side. It was agreed to. And I think that's, again, a point that really upset a lot of us because it had been an agreed‑to process.
BILL SCHNEIDER: Sure. Sure.

JOHN MALONE: Dr. Rogers, I'm sure ‑‑ Dr. Rogers, I'm sure, was very much upset over that.
BILL SCHNEIDER: Yeah. And an awkward position for the Cowper administration, too.
JOHN MALONE: Yeah. Very awkward for Dr. Rogers who had to orally make his presentation before the legislature.
I wasn't there when he did this, but I can certainly appreciate, he was very much restrained -- is -- I'm sure what his personal opinion was of the process. Because he had been at it ‑‑ I wouldn't say two years, but we were going on two years. This was a pretty involved ‑‑ pretty involved thing.

And the land surface estate was all ‑‑ had been appealed, and went through an appeal process on that, which Dr. Rogers chaired all the appeals. And again, it was a pretty extensive ‑‑ pretty extensive process. Again, it wasn't unilateral.

Section 18: BILL SCHNEIDER: Uh‑hum. Well, and that brings us up to, I think, the report that you authored, isn't it?
JOHN MALONE: Did I author one?
BILL SCHNEIDER: The Lands Committee Report on DNR Value Determination to Mental Health Trust Funds.
JOHN MALONE: Oh, I was on the ‑‑ gee, I had forgotten about that. Yes, I was on the ‑‑ well, no ‑‑
BILL SCHNEIDER: Karen will help me.
JOHN MALONE: ‑‑ I was on the Mental Health Board at that time.
BILL SCHNEIDER: Uh‑hum.

JOHN MALONE: And of course, the Mental Health Board was really, really very much interested in an outcome for this.
BILL SCHNEIDER: Yeah.
JOHN MALONE: We were trying to do ‑‑ I say "we" ‑‑ the whole board was trying to do anything in its power to facilitate a resolution, an equitable resolution. And I was the ‑‑ let me see.
I chaired ‑‑ I guess I chaired for many years the Program and Planning Committee for the board. And, well, I can't remember, I think Thelma Langdon was our chairperson on the board at that time.

She nominated me to this committee, for this committee to evaluate what the land determination was from the commissioner, what I thought of it. In other words, make a report to the Mental Health Board on this evaluation. And yes, I guess I did write that report. And interesting, I had forgotten about that report.
BILL SCHNEIDER: But we ‑‑ had you had formal training in land evaluation at that point?

JOHN MALONE: Surface estate. I did real estate appraising out there in Western Alaska for probably 12 years. Surface estate, housing, residential, some commercial, some BIA, allotments, that type of stuff. Nothing to the extent of this. Some commercial, small commercial in the community, but nothing to this extent.
I certainly had no experience ‑‑ well, very limited experience. I had some friends that were in the mining business, platinum for one.
BILL SCHNEIDER: Uh‑hum.

JOHN MALONE: But I certainly had no background in evaluating a mineral estate. In fact, most of what I had learned was from Paul Mett (phonetic), listening to him ‑‑ listening to him quite a bit.
BILL SCHNEIDER: Uh‑hum.
JOHN MALONE: And then later on meeting Dickson, but that was still a pretty brief experience, and then their report, of course.

But I was ‑‑ we were ‑‑ we were getting a sense that as the values started to come out of the commission process, that ‑‑ and the State, I guess, became a little more testy about that process, particularly in the surface appeals. The surface estate was being appealed by the State, and had to bring in another appraiser and go over these things.

We had kind of a sense that the State was looking for ways to, I don't know, "renege on the deal" is probably too strong a language, but the value was probably, they thought, was getting out of hand.

But again, Dr. Rogers would probably be the better one to ‑‑ again, he's the one that had to write the final report. And ‑‑ and I think isn't ‑‑ I think the report that I wrote for the Mental Health Board was a critique on Dr. Rogers' final report to the legislature. I think that's what it ‑‑ that's what it was. Because a lot of people in the periphery, a lot of people who are in the periphery who were beneficiaries, who later became beneficiaries were pretty upset about the commission decision because it basically trashed the ‑‑ the settlement, Chapter 48.

Well, that's not totally true because at the eleventh hour, the legislature, Governor Cowper sent Myra Munson, who was then his Commissioner of Health and Social Services, in front of the legislature, like the last 24 hours, and encouraged them to pass Chapter 48 with a ‑‑ I forget what the caveat was. It certainly wasn't the values that the commission had come back with, there was some caveats in it, but they turned it down. The legislature didn't accept it. But we're talking about eleventh hour, we are talking about the last night of the session. Surprised us all.

Section 19: BILL SCHNEIDER: So that was a real tragedy, at that point.
JOHN MALONE: Well, it was a real letdown to all of us because, I don't know, I was getting to the ‑‑ I was getting into the mode of ‑‑ well, I guess, what you don't learn, you're not familiar with when you get into one of these huge cases dealing with your government, and trying to come up with a resolution for your government around a policy position that they should be ‑‑ they should have accepted a long time ago, like these became ‑‑ these were your beneficiaries.

You had a responsibility to care for them. You had a responsibility to do whatever. And the State's reluctance to step up to this role, if you will.
Because at that time, if the State would have come forward with any reasonable solution for value in the trust, like later came on the next settlement, which was called hypothecated land ‑‑ I don't know, did you get into hypothecated land with Judge Greene?

BILL SCHNEIDER: I'm not sure.
JOHN MALONE: She mentioned it once in her transcript, and I read it, and I was wondering if you guys ‑‑ she didn't explain what that was, but the next settlement involved, quote, hypothecated land.
And hypothecated land is basically lands that are selected and held aside for a purpose, and that purpose was they would pay rent on them, the State would pay rent on them to the trust, and this was the income to the trust, versus I think the 1976 re-designation, re-designating the land and paid nothing, wouldn't pay a nickel.

So anyway, the ‑‑ of course, the next settlement came up was called ‑‑ the center, the centerpiece of it was this selection of hypothecated lands, lands that would be set aside and held in reserve, but weren't transferred in title to the trust for the purpose of a trust, and paid on a lease basis to the trust.

Section 20: JOHN MALONE: I think it's an important piece.
I've ‑‑ several times I've reduced ‑‑ in fact, in one ‑‑ on one ‑‑ on one occasion, I ended up with a copy of Governor Hickel's final bill, and had it framed, and I wrote a one‑pager covering the whole ‑‑ everything we've talked about in one page.

Then I wrote an article for a journal, and I can't remember the journal because I just found the article the other day. Went into a little more, of course, expanded on it quite a bit more. But I guess I was totally amazed when I read that article, the level of complexity that was involved in this.
Of course, when you're that close to it ‑‑ I co‑chaired the plaintiff's committee in the final settlement. Art ‑‑ Art ‑‑ Art ‑‑ what was his name. He had been the business manager at API. I'm brain dead.

He was a member of the Alaskan ‑‑ of the Mental Health Association, then became the president of the Association, then he became the Association's representative before the plaintiff's committee. And he asked me to join him in this because we were having a hell of a time getting a consensus.
And Mr. Gottstein had offended many oil companies because he wanted to expand the mineral resources through oil and gas.

So he brought in a whole bunch of folks we had never seen before from Marathon Oil, and this oil company and that oil company, who had no idea what this was really all about. They just were there to represent their companies.
So anyway, at that time ‑‑ at that juncture he asked me to join him, and so I became co‑chair of the plaintiff's committee, we called it the plaintiff's committee. We met at API every week, up in the API classroom.