Chairman Nelson called the conference committee on House Bill 1012 to order and opened work on the Human Services budget, saying, “I'll call the conference committee on, house bill 10 12 to to order.”

The committee approved a string of Senate-position technical changes and department adjustments by voice or roll-call votes, including updated clinic revenue assumptions, a Southeast Human Service Center bathroom remodel, LIHEAP and foster-care caseload adjustments, the revised FMAP calculation and several one-time grants. Jessica Thomason of the Department of Human Services summarized early-childhood program demand and funding trade-offs: “we would, be able to continue to grow the program with dollars,” she told the committee about Best in Class expansion and federal fund changes.

Why it matters: committee decisions on HB1012 will determine biennial appropriations for behavioral health, guardianship transition funding, community grants and capital projects that affect hospitals, long-term care and local providers across the state. Several contested items — most prominently the size and funding method for a new state psychiatric hospital and discretionary behavioral-health facility grants — remain unresolved.

Major discussion points

State hospital: Members spent the longest portion of the meeting on the proposed new state hospital. The House position on construction was $330 million, the governor’s recommendation cited at $300 million, and the Senate previously placed a lower figure (about $285 million) on its version. Committee members described differences in bed counts tied to those price points and debated whether authority and final configuration should rest with this conference committee or be left to the Office of Management and Budget (OMB) and OMB-led construction oversight. Multiple conferees stressed the project’s legacy scope and recommended that the conference committee retain authority to set the final scope and allow a base bid with negotiated add-alternates to preserve flexibility as bids come in.

Behavioral-health facility grants and construction: The committee debated several facility grant requests, including a $12.9 million request for an Altru Health System project (reduced on the Senate side) and other proposed grants for regionally important capacity, including adolescent beds. Members expressed concern about federal funding shifts and urged clearer documentation about local cost share and project readiness before allocating state dollars.

Early-childhood programs and “Waterford/Upstart” vs. Best in Class: The committee discussed the Senate’s decision to reduce Waterford/Upstart funding and to prioritize 0–3 child-care slot funding instead, and whether the Waterford program is better housed at the Department of Public Instruction (DPI) or Department of Human Services (HHS). Jessica Thomason (HHS) told the committee that Best in Class demand had grown and that federal one-time dollars previously used to supplement the program would not recur; the committee asked HHS for a breakdown of federal carryover and the number of additional communities served by incremental state dollars.

Guardianship office transition and timing: Members discussed ensuring a seamless funding transition for a newly created guardianship office (referenced in conference bill language for Senate Bill 2129). Staff proposed splitting a $6.5 million obligation to cover the department for the first year and then transferring any remainder to the new office once it is operational; committee members requested draft transfer language and implementation timing tied to the separate bill’s enactment.

Votes at a glance

- Clinic revenue assumption (Senate change): Motion to adopt Senate change moved by Senator Cleary; roll call 6–0 (Chairman Nelson, Representative O'Brien, Representative Mitscog, Chairman Deaver, Senator Cleary, Senator Davidson) — passed.

- Southeast Human Service Center bathroom remodel (Senate position): Motion to adopt Senate position moved by Senator Deaver; roll call 6–0 — passed.

- LIHEAP reduction and foster-care expected caseload (Senate adjustments): Motion to accept the Senate positions moved by Representative O'Brien; roll call 6–0 — passed.

- Ministry on the Margins grant ($285,000; Senate position): Motion to adopt Senate position moved by Senator Deaver; roll call 6–0 — passed.

- Revised FMAP: Motion to accept revised FMAP moved by Representative O'Brien; roll call 6–0 — passed.

- Housing-assistance SIF funding (house position moved into Industrial Commission budget): Motion to adopt the House position; roll call 6–0 — passed.

- Anne Carlson intermediate-care facility grant (house amount $3,457,000 with Community Health Trust Fund as source): Motion to adopt house amount and Community Health Trust Fund as source moved by Senator Deaver and seconded by Representative O'Brien; roll call recorded as Chairman Nelson (yes), Representative O'Brien (yes), Representative Mitscog (yes), Chairman Deaver (yes), Senator Clary (no), Senator Davidson (no) — tally 4–2, motion carried.

What the committee did not decide

The committee deferred final action on (a) the precise combined funding levels for Community Connect and Free Through Recovery (members discussed Senate reductions of roughly $958,814 and $2,016,908, respectively, and different percentage increases from base budgets), (b) several larger behavioral-health facility grants where members requested clarity on local cost-share and readiness, (c) the Waterford/Upstart funding question versus Best in Class expansion pending HHS data on federal carryover and waitlist/participation, and (d) detailed bonding or financing options for the state hospital (members requested a bond-schedule analysis and draft language to permit add-alternates and phased funding).

Ending

Committee staff agreed to circulate requested follow-up materials — program-level federal carryover figures, project readiness/cost-share documentation, sample bond schedules and draft appropriation/transfer language for the new guardianship office — before the next conference meeting. The committee recessed to reconvene later; no final omnibus report was adopted at this session.