Mental Health Region struggles to spend enough

MARENGO — Spending money may seem easy, but it’s proving difficult for some of Iowa’s mental health regions.

In 2021, the Iowa Legislature passed Senate File 619 making the state’s mental health regions responsible to the state for their fund balances, Mae Hingtgen, CEO for Mental Health/Disability Services of the East Central Region, told Iowa County Supervisors last week.

The State mandated that regions keep on hand no more than 40% of their budgets by the end of fiscal year 2022, no more than 20% by the end of fiscal year 2023 and no more than 5% by the end of this fiscal year.

A couple of things created huge obstacles to reaching those goals in fiscal years 2020 and 2021, said Hingtgen.

Iowa County received $9.8 million from the federal Coronavirus Aid, Relief and Economic Security Act. That didn’t count toward the Region’s fund balance, but the Region was spending the CARES money rather than the money in its budget, she said.

Because of COVID, some services shut down, services that would have used the Region’s money. Instead, the funds stayed with the Region, so the Region’s balance went up.

In FY22, Hingtgen went to the Regional board with $11.1 million in projects and workforce meant to lower the Region’s balance the appropriate amount.

But at the end of FY22, the Region had a balance of 66%, well above the 40% required by the State of Iowa. The state responded by giving the region $6.4 million less the following year. That $6.4 million was put into a fund from which counties that are short can draw, Hingtgen said.

In FY23, the Region had to reduce its ending balance to 20% of its budget. Hingtgen told the Region board in January, “We need to spend a little over $4 million.”

The board approved about $4.8 million in projects providing mental health access and providers.

In May, the Region had to reduce another $4 million. The board approved projects totaling $5.1 million. It had three weeks to reach the 20% balance mandated by the state.

With projects and additional spending, the Region made it to 17%.

“Now we’ve got to get down to 5%,” Hingtgen told Iowa County Supervisors.

Supervisors wondered what kinds of projects the millions are paying for. Hingtgen said the Region has helped purchase properties for two programs. It helps create access centers, and fund schools and law enforcement with their mental health activities.

“We bought a lot of technology,” said Hingtgen. “We funded permanent housing for homeless shelters.” Almost $2 million from the Region helped with homeless shelters and brain health services, she said.

The Region’s money can pay for bonuses and signing bonuses for personnel to recruit and retain employees, but it can’t be used for salaries because the funding is not continuous.

The Regions have been told to spend money “but don’t break the law,” said Hingtgen. The State has strict rules about how the money can be spent.

The FY42 budget is $29.4 million, said Hingtgen. The Region must spend $25 million.

But Hingtgen and her team have planned ahead this year, she said. “We don’t like the second half of the year to be scrambling,” she said. They’ll monitor the balance more closely.

The Region will present several projects to its board in the first quarter meeting in October. The Region will have additional projects to present to the board for approval if it hasn’t spent 58% of its budget by February. These will be projects, such as grant funding for access centers, access hubs and outpatient treatment, that will take less time to implement, increasing the likelihood that the money will be spent by the end of the fiscal year.

At the May meeting, the Region will have projects with shorter lead times — capital and technology projects, workforce recruitment and retention grants — for board approval if it hasn’t spent 83% of its budget by that time. That will put the Region on track to end the year at 5% as required by law.

Why doesn’t the East Central Region spend what it needs to provide services and let the rest of the money go back to the state, asked County Supervisor Abby Maas.

Hingtgen admitted that the Region board is split on that issue, as are many Mental Health Region boards.

The money that Regions don’t spend go into a pool, Hingtgen said. “We’re a little concerned about that pool,” she said. It was up to $128 million last year and five Regions are on pace to exceed a 5% balance and lose more money to the pool this year.

“If it goes into that fund, isn’t that what’s better for Iowa?” asked Maas. The money goes where it’s needed. “It’s not a competition,” she said.

The East Central Region, which consists of Bremer, Buchanan, Delaware, Dubuque, Benton, Linn, Jones, Iowa and Johnson Counties, is the largest of Iowa’s 13 mental health regions with a population of 611,000.

The smallest, the Southern Hills Region, consists of only four counties — Adair, Adams, Union and Taylor, fewer than 29,000 people.