Notice: This opinion is subject to correction before publication in the PACIFIC REPORTER. 

Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts, 

303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email 

corrections@akcourts.us. 

THE SUPREME COURT OF THE STATE OF ALASKA 

ALASKA SPINE CENTER, LLC, 

Appellant, 

v. 

MAT-SU VALLEY MEDICAL CENTER

LLC, an Alaska limited liability company 

d/b/a Mat-Su Regional Medical Center; 

SURGERY CENTER OF WASILLA, 

LLC; and STATE OF ALASKA, 

Appellees. 

) 

) Supreme Court No. S-16917 

Superior Court No. 3AN-16-10186 CI 

O P I N I O N 

No. 7349 – March 29, 2019 

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Appeal from the Superior Court of the State of Alaska, Third 

Judicial District, Anchorage, Frank A. Pfiffner, Judge. 

Appearances: Susan Orlansky, Reeves Amodio LLC, 

Anchorage, for Appellant. Jennifer M. Coughlin, Landye 

Bennett Blumstein LLP, Anchorage, for Appellee Mat-Su 

Valley Medical Center, LLC. Danielle M. Ryman, Perkins 

Coie LLP, Anchorage, and David B. Robbins, Kathleen M. 

O’Sullivan, and Luke Rona, Perkins Coie LLP, Seattle, 

Washington, for Appellee Surgery Center of Wasilla, LLC. 

Notice of nonparticipation filed by Dario Borghesan, 

Assistant Attorney General, Anchorage, and Jahna 

Lindemuth, Attorney General, Juneau, for Appellee State of 

Alaska. 

Before: Bolger,ChiefJustice,Winfree,Stowers, andCarney, 

Justices. [Maassen, Justice, not participating.] 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CARNEY, Justice. 

I. INTRODUCTION 

The state agency responsible for regulating the operation of healthcare 

facilities throughout Alaska requires most such facilities to document the need for 

proposed services before the state approves construction of a new facility. The agency 

determined that an ambulatory surgical facility seeking to relocate from Anchorage to 

Wasilla did not need to submit such documentation because it was moving within the 

same community as defined by the relevant statute. Competing medical facilities in the 

Matanuska-Susitna Borough objected to the determination, arguing that Anchorage and 

Wasilla are not the “same community” and that the proposed relocation required the 

usual certification of need. Because Anchorage and Wasilla are not the same community 

as contemplated by the statute, we reverse the determination that the facility was exempt 

from the required certification process. 

II. FACTS AND PROCEEDINGS 

A. Background 

The Alaska Department of Health and Social Services is responsible for the 

regulation and provision of numerous health and social services programs. In order to 

promote the balanced development and operation of such facilities throughout the state, 

the legislature established a “Certificate of Need” program to be administered by the 

Department.1 Pursuant to statute and regulation, program staff determine the healthcare 

needs of an area by using a number of general and service-specific review standards and 

calculations.2 The standards address “Alaska’s distinctive operational environment” by 

1 AS 18.07; see Ch. 275, § 2, SLA 1976. 

2 See AS 18.07.035, 18.07.101; 7 Alaska Administrative Code (AAC) 

(continued...) 

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taking into account accessibility and the needs of local stakeholders. The program’s goal 

is to ensure that no area receives more or fewer services than it needs. 

Most healthcare facilities are required to obtain a certificate of need (CON) 

before beginning construction: 

(a) Except as provided in (c) and (d) of this section, a person 

may not make an expenditure of $1,000,000[3] or more for 

any of the following unless authorized under the terms of a 

certificate of need issued by the department: 

(1) construction of a health care facility; 

(2) alteration of the bed capacity of a health care 

facility; or 

(3) addition of a category of health services provided 

by a health care facility.[4] 

Preparing and submitting a CON application is a time-consuming process. 

The CON application must contain all of the information required in the Department’s 

Certificate of Need Application Packet, which includes: a project description with 

detailed cost estimates and construction timelines; estimates of the population to be 

served and in what capacity; analysis of the need for these services; documented efforts 

of community outreach; comparison to community, state, and federal plans; analysis of 

alternatives; calculations of the impact the facility will have on the existing healthcare 

system; and evidence that the facility will be accessible to users. The applicant must also 

2 (...continued) 

07.025(a)(3) (2019); STATE OF ALASKA, DEP’T OF HEALTH & SOC. SERVS., ALASKA 

CERTIFICATE OF NEED REVIEW STANDARDS AND METHODOLOGIES 1 (2005), 

http://www.dhss.alaska.gov/ dhcs/Documents/CertificateOfNeed/Standards.pdf. 

3 AS 18.07.031(d) raised the threshold to $1.5 million as of July 2014. 

4 AS 18.07.031(a). 

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pay an application fee, agree to participate in a statewide reporting system required by 

statute, and state whether the proposed CON is intended to change the bed capacity of 

the service area.5 

But a statutory exemption allows an existing ambulatory surgery facility to 

relocate within the same community as long as it does not increase the services that it 

offers: 

Notwithstanding (a) of this section, a person who is lawfully 

operating a health care facility that is an ambulatory surgical 

facility at a site may make an expenditure of any amount in 

order to relocate the services of that facility to a new site in 

the same community without obtaining a certificate of need 

as long as neither the bed capacity nor the number of 

categories of health services provided at the new site is 

greater.[6] 

The relocation exemption was added to the CON statute in 2000 after an 

ambulatory surgical center that wished to relocate two blocks from its existing location 

in Anchorage lobbied for an exemption to allow it to avoid the costs of the CON 

process.7 The Anchorage facility’s move was exempted shortly after the legislation 

passed. Fifteen years later a Wasilla facility relocated within Wasilla, and was granted 

the same exemption. Alaska Spine is the third applicant for an exemption from the CON 

requirement. 

To determine whether it qualifies for an exemption or must expend the time 

and resources needed to prepare a CON application, a healthcare facility may submit a 

5 7 AAC 07.040(a) (2010). 

6 AS 18.07.031(c). 

7 Ch. 18, § 2, SLA 2000; see Beal v. McGuire, 216 P.3d 1154, 1159-61 

(Alaska 2009) (providing a history of the exemption’s creation). 

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Request for Determination (RFD) to the Department prior to beginning the CON 

process.8 Once the Department makes a determination, it must publish notice of its 

decision online and in a statewide newspaper.9 

B. Facts 

Alaska Spine Center is an ambulatory surgical facility located in 

Anchorage. Alaska Spine was not required to obtain a CON when it first constructed its 

facility, nor when it later built an addition, because each of those projects cost less than 

the threshold amount at the time. 

In early August 2016 Alaska Spine submitted an RFD to the Department 

seeking a determination that its relocation to Wasilla was exempt from CON 

requirements under AS 18.07.031(c). It requested the exemption because it would be 

relocating within the “same community” and would not increase its service capacity.10 

The RFD acknowledged that costs “will exceed the current CON monetary threshold of 

$1.5million.” Alaska Spine explained that further cost details wereunnecessary because 

the relocation exemption permitted expenditures of any amount. 

The Department’s CON program staff sent a letter to Alaska Spine seeking 

additional information: acertifiedcostestimate, amorespecificlocation description, and 

a description of specific services to be offered. In response to Alaska Spine’s claim that 

a more detailed cost estimate was unnecessary, the letter stated that “the Department 

cannot make that [d]etermination on the information provided.” 

8 7 AAC 07.031. 

9 7 AAC 07.032. 

10 See AS 18.07.031(c) (allowing ambulatory surgical facility to relocate 

regardless of cost and without CON so long as bed capacity and services provided do not 

increase and it moves within same community). 

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Alaska Spine met with CON program staff to discuss the RFD, then 

submitted additional information on October 11. Following the meeting, program staff 

agreed with Alaska Spine that no cost estimate was necessary and accepted the 

acknowledgment that the cost would exceed $1.5 million because “there is no issue 

regarding whether this project will exceed the CON cost threshold.” Program staff also 

determined that accepting such an estimate was in line with past CON determinations. 

C. Proceedings 

In October 2016 the Department published its determination: “For the 

purposes of CON, Wasilla is considered to be in the same service area as Anchorage. 

Therefore, the proposed relocation is considered to be within the same community.” The 

determination also noted “neither capacity nor the number of categories of health 

services provided at the site will be greater.” The Department concluded that Alaska 

Spine satisfied the exemption requirements of AS 18.07.031(c) and did not require a 

CON to relocate its facility to Wasilla. 

In November 2016 Mat-Su Valley Medical Center, LLC filed suit in 

Anchorage superior court challenging the Department’s determination, seeking 

declaratory and injunctive relief against the Department and Alaska Spine. Mat-Su 

Medicaloperates fivesurgerysuites in theMatanuska-SusitnaValley at aPalmer facility. 

Mat-Su Medical argued that Anchorage and the Matanuska-Susitna Valley are not the 

“same community,” that Alaska Spine therefore did not qualify for a relocation 

exemption, and that the Department’s determination that it was exempt from a CON did 

not comply with the RFD regulation and was therefore void. Mat-Su Medical also 

sought both preliminary and permanent injunctions against the construction and 

operation of Alaska Spine’s proposed Wasilla facility unless and until a CON was 

obtained. Both Alaska Spine and the Department answered the complaint, arguing the 

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Department’sdetermination was entitled to deference and that it had properly interpreted 

the CON laws and regulations. 

In April 2017 Alaska Spine moved for summary judgment, arguing that the 

Department’s determinationand its acceptanceoftheRFDwereowed deference because 

both were within the Department’s specialized expertise. In response Mat-Su Medical 

filed a cross-motion for summary judgment, arguing that the meaning of “same 

community” was an issue of statutory interpretation committed to the court’s 

independent judgment. It also argued that the statutory language, legislative history, and 

the Department’s own regulations did not support the determination that Anchorage and 

Wasilla are in the “same community.” Mat-Su Medical argued in addition that a certified 

cost estimate was explicitly required by regulation and could not be waived in an RFD. 

The Department supported Alaska Spine’s motion for summary judgment 

and opposed Mat-Su Medical’s cross-motion. Alaska Spine opposed Mat-Su Medical’s 

cross-motion for summary judgment. 

SurgeryCenter of Wasilla, LLC, the only other ambulatory surgical facility 

operating in theMatanuska-SusitnaValley, moved to intervene in June. Mat-Su Medical 

asked the court to allow the intervention; both the Department and Alaska Spine opposed 

it. The superior court granted the motion to intervene and Surgery Center of Wasilla 

joined Mat-Su Medical’s arguments against the exemption determination and lack of a 

cost estimate in the RFD.11 

The superior court granted Mat-Su Medical’s cross-motion for summary 

judgment and denied Alaska Spine’s motion for summary judgment. The court applied 

its independent judgment and concluded that Anchorage and Wasilla are not the same 

On appeal, we refer to Mat-Su Medical and Surgery Center of Wasilla 

collectively as “Mat-Su Medical.” 

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community. The court also found that Alaska Spine’s RFD was void because its failure 

to include a cost estimate did not comply with the regulation. 

Alaska Spine appeals. The Department has not appealed. 

III. STANDARD OF REVIEW 

“When the superior court acts as an intermediate appellate court, we 

independently review the merits of the underlying administrative decision. The specific 

form our independent review takes is de novo review.”12 

We apply our independent judgment to review the agency’s interpretation 

of “same community.”13 Independent judgment is appropriate “where the agency’s 

specialized knowledge and experience would not be particularly probative on the 

meaning of the statute.”14 “[W]e ‘look to the meaning of the language, the legislative 

history, and the purpose of the statute and adopt the rule of law that is most persuasive 

in light of precedent, reason, and policy’ ” when determining the meaning of a statute.15 

When applying the plain meaning rule, we use “a sliding scale approach to statutory 

interpretation, in which ‘the plainer the statutory language is, the more convincing the 

12 Heller v. State, Dep’t of Revenue, 314 P.3d 69, 72 (Alaska 2013). 

13 Mat-Su Valley Med. Ctr., LLC v. Advanced Pain Ctrs. of Alaska, Inc., 218 

P.3d 698, 700 (Alaska 2009) (“[I]nterpretation and application of a statute are questions 

of law to which we apply our independent judgment.”). We review agency decisions 

under the reasonable basis standard when they involve agency expertise or implicate 

fundamental policies within the scope of the agency’s function. Matanuska-Susitna 

Borough v. Hammond, 726 P.2d 166, 175 (Alaska 1986). Although it is not clear that 

either is the case here given the dearth of previous applications for CON exemptions, our 

decision would be the same under the reasonable basis standard. 

14 Hammond, 726 P.2d at 175. 

15 Mat-Su Valley Med. Ctr., LLC, 218 P.3d at 701 (quoting Enders v. Parker, 

66 P.3d 11, 13-14 (Alaska 2003)). 

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evidence of contrary legislative purpose or intent must be’ ” to overcome the plain 

meaning.16 

IV.	 DISCUSSION 

The relocation exemption to the CON requirement allows an ambulatory 

surgical facility to relocate, regardless of the cost, so long as the relocation is in the same 

community and does not increase the bed capacity or number of health service categories 

provided.17 Alaska Spine’s new facility will not increase its bed capacity or number of 

health service categories. At issue is whether Alaska Spine’s move from Anchorage to 

Wasilla satisfies the exemption’s requirement that it relocate within the “same 

community.” 

Anchorage and Wasilla are not in the “same community.” Neither the plain 

language nor its legislative purpose allows for a determination that they are. The 

legislative history does not clearly support attaching a meaning to “same community” 

other than the plain language. While we need not define “same community,” it is clear 

that Wasilla and Anchorage do not fall within the term’s bounds. We therefore affirm 

the superior court’s grant of Mat-Su Medical’s cross-motion for summary judgment and 

its denial of Alaska Spine’s motion for summary judgment.18 

A.	 The Meaning Of “Same Community” Is Clear Based On The Plain 

Language Of The Statute. 

“When interpreting a statute, we construe its language ‘in accordance with 

16 Adamson v. Municipality of Anchorage, 333 P.3d 5, 11 (Alaska 2014) 

(quoting McDonnell v. State Farm Mut. Auto. Ins. Co., 299 P.3d 715, 721 (Alaska 

2013)). 

17 AS 18.07.031(c). 

18 Because we find Alaska Spine does not meet the requirements for “same 

community,” we do not otherwise address the validity of Alaska Spine’s RFD. 

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[its] common usage, unless the word or phrase in question has acquired a peculiar 

meaning by virtue of a statutory definition or judicial construction.’ ”19 “Same 

community” has not acquired any peculiar meaning in the CON context. The phrase is 

not used in any other part of the CON statutes and regulations, nor is there a definition 

in any other statute or regulation to which the CON program could look for guidance. 

“Same community” is a non-technical term and does not require a statutory definition to 

be understood. The common usage of the term “community” does not support the 

determination that Anchorage and Wasilla are in the “same community.”20 

Alaska Spine and Mat-Su Medical argue for various dictionary definitions 

to support their interpretations of “same community.” But there is no need to go beyond 

the common usage of the term:21 Wasilla and Anchorage are not commonly considered 

to be the “same community.” Neither Anchorage residents nor Wasilla residents would 

consider themselves to be members of the same local community. The Municipality of 

Anchorageandthe Matanuska-Susitna Borough (in which Wasillais located) aredistinct 

boroughs with separate local governments.22 Wasilla is located 44 miles northeast of 

19 City of Valdez v. State, 372 P.3d 240, 251 (Alaska 2016) (alteration in 

original) (quoting Municipalityof Anchoragev.Suzuki, 41P.3d 147, 150 (Alaska2002)). 

20 See Mat-Su Valley Med. Ctr., LLC, 218 P.3d at 703 (interpreting statute as 

it would be “rationally read”). 

21 City of Valdez, 372 P.3d at 251; see also Mat-Su Valley Med. Ctr., LLC, 218 

P.3d at 703-04 (interpreting statute based on what is grammatically correct, effect on 

enforcement, and most rational reading of statute). 

22 BoroughsinAlaska, BALLOTPEDIA.ORG, https://ballotpedia.org/Boroughs_ 

in_Alaska (last visited January 28, 2019); Matanuska-Susitna Borough, Incorporated 

City Parcel Maps, MATSUGOV.US, https://www.matsugov.us/maps/incorporated-cityparcel-maps (last visited January 28, 2019) (Certain areas of Alaska have formed 

boroughs which act as political subdivisions of the state.). 

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Anchorage and is about a 55 minute drive away.23 As the superior court noted, 

Anchorage and Wasilla have separate school districts, separate police forces, different 

elected state representatives, independent hospitals, and no overlapping taxation issues. 

The CON program coordinator looked at the definition of “service area” to 

determine whether Wasilla and Anchorage were in the same community. But the 

Department’s regulations for the CON program suggest that the two terms are not 

interchangeable. The regulations define “service area” as “the geographic area to be 

served by the proposed activity, including the community where the proposed activity 

will be located.”24 The definition thus suggests that “service area” is a broader concept 

than “community.” 

Alaska Spine argues that defining community as the service area makes 

sense because service area is the unit used to calculate health service needs, so relocating 

within the same service area should not change the calculations of need done by the 

Department. But the regulatory definition of service area treats community as its subset, 

and the use of different language shows these phrases are not synonymous. Principles 

of statutory construction mandate that we assume the legislature meant to differentiate 

between two concepts when it used two different terms.25 “Service area” is defined as 

an area “including the community where the proposed activity will be located.”26 

“Including” suggests that a community fits within a service area, but is not its equivalent. 

23 Alaska Driving Map, ALASKA.ORG, http://www.alaska.org/assets/content/ 

maps/Alaska-Driving-Map.pdf (last visited January 28, 2019). 

24 7 AAC 07.900(36) (emphasis added). 

25 See Ganz v. Alaska Airlines, Inc., 963 P.2d 1015, 1018-19 (Alaska 1998) 

(assuming if legislature meant the same type of restriction in both subsections then it 

would have used similar language). 

26 7 AAC 07.900(36) (emphasis added). 

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“Service area” is also used throughout CON regulations and application instructions;27 

if the legislature meant “community” to be synonymous with “service area,” a term 

discussed by the legislature prior to passing the relocation exemption, it would have had 

no reason to use the different term “community.”28 We assume the legislature used a 

different word because it meant a different thing, and that the Department complied with 

legislative intent when it wrote its regulations.29 The plain meaning of “same 

community” is not equivalent to “service area.” 

B.	 The Legislative History Of AS 18.07.031 Is Not Contrary To The Plain 

Meaning Of “Same Community.” 

A party urging us to give statutory language a meaning other than its plain 

meaning bears the burden of demonstrating that legislative history is contrary to the plain 

meaning.30 The clearer the plain language, the more persuasive contrary legislative 

history must be.31 The relocation exemption plainly states that the relocation must be in 

the “same community.” The legislative history surrounding this term is too inconclusive 

to disprove the plain meaning. 

27 All of the following regulations use the term“service area”: 7 AAC 07.010, 

07.025, 07.032, 07.040, 07.042, 07.052, 07.070. 

28 See Minutes, House State Affairs Comm. Hearing on H.B. 297, 21st Leg., 

1st Sess. (Mar. 16, 2000) (statement of Rep. Jeannette James, Chair, House State Affairs 

Comm.). 

29 See Alaska Ass’n of Naturopathic Physicians v. State, Dep’t of Commerce, 

414 P.3d 630, 634-35 (Alaska 2018) (noting that the party challenging a regulation bears 

the burden of showing it is inconsistent with the statute). 

30 See State v. Fyfe, 370 P.3d 1092, 1095 (Alaska 2016). 

31 Adamson v. Municipality of Anchorage, 333 P.3d 5, 11 (Alaska 2014). 

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Thestatutory amendmentallowed ahealthcarefacility to avoid theexpense 

and delay of the CON process if it relocated within the same community without 

increasing the services offered.32 This legislative change was considered necessary 

because “CON time frames are extensive” and in the past “the CON could not be 

finished in the proper length of time.”33 Because there would be no change in the 

facility’s capacity or services offered, the legislature determined that a CON was not 

required.34 

The legislative history of the relocation statute provides little guidance, but 

is not clearly contrary to the statute’s plain language. The legislative testimony and 

discussion were conflicting. The hearing record included a statement that Fairbanks and 

Delta Junction might be in the “same community” because they are in the same “service 

area.”35 It contained statementsfromthecommitteechair that “communitymeans service 

area.”36 But the chair also stated that the “same community” exemption “would not 

allow someone to move from Anchorage to the Matanuska-Susitna Borough or vice 

versa,” in part because facilities in Anchorage do not address the same community needs 

as those in the Matanuska-Susitna Valley.37 

32 Minutes, House State Affairs Comm. Hearing on H.B. 297, 21st Leg., 1st 

Sess. (Mar. 16, 2000) (sponsor statement on H.B. 297). 

33 Id. (statement of Rep. Jeannette James, Chair, House State Affairs Comm.). 

34 Id. 

35 Id. (testimony of Rick Soley, Dir. of Community Relations & Planning, 

Fairbanks Mem’l Hosp. & Denali Ctr.). 

36 Id. (statement ofRep. Jeannette James,Chair,House State Affairs Comm.). 

37 Id. 

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The committee also alternated between leaving the “same community” 

determination to theDepartment’s expertise and defining the termitself. Thechair ended 

the discussion of whether Fairbanks and Delta Junction were the same community by 

declaring that the determination would be up to the Department, but then independently 

determined that Anchorage and the Matanuska-Susitna Borough were not in the same 

community.38 

Alaska Spine argues that this legislative history supports deference to the 

Department’s interpretation of “same community.” Mat-Su Medical argues that it does 

not, but urges us to focus on the statement that a move from Anchorage to the 

Matanuska-Susitna Borough — as Alaska Spine proposes — would not be allowed. 

We are not persuaded by either argument. To overcome the plain meaning 

of the statute, Alaska Spine must demonstrate that the legislative history is clearly 

contrary to it. It has not done so. The legislative history is contradictory and ambiguous, 

and does not overcome the presumption in favor of the statute’s plain language. 

C.	 The Legislative Purpose Of AS 18.07.031 Supports The Plain Meaning 

Of “Same Community.” 

“[W]hen engaging in statutory interpretation, we aim to ‘construe a statute 

in light of its purpose.’ ”39 We look to the intent of the legislature and prior applications 

of the statute by the agency when determining legislative purpose.40 

38 Id. (statement of Rep. Jeannette James, Chair, House State Affairs Comm.; 

testimony of Sharon Anderson, Alaska State Hosp. & Nursing Home Ass’n). 

39 City of Valdez v. State, 372 P.3d 240, 254 (Alaska 2016) (quoting Alaskans 

for a Common Language, Inc. v. Kritz, 170 P.3d 183, 193 (Alaska 2007)). 

40 See id. at 254-55; N. Alaska Envtl. Ctr. v. State, Dep’t of Nat. Res., 2 P.3d 

629, 634 (Alaska 2000). 

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1.	 The relocation exemption’s purpose 

The CON program was established to ensure that there was “a need for the 

proposed service” before authorizing the construction of newhealth care facilities.41 The 

later addition of an exemption for a facility relocating within the same community 

allowed the Department to waive completion of a CON, but did not alter the CON 

program’s purpose. 

When a facility providing the same amount and type of service relocates 

within the same community, the CON calculations of need in that service area are not 

affected. The relocation exemption was intended to allow facilities which are not 

expanding their services to avoid the delays and expenses of the full CON process. The 

relocation exemption’s purpose of streamlining the process for such facilities creates a 

narrow exception for a small number of applicants; it works in concert with the CON 

statute to achieve the legislature’s overarching purpose. 

2.	 Past applications of the relocation exemption and the term 

“community” 

Alaska Spine argues that determining that it was eligible for the exemption 

aligns with the purpose of the statute. It urges us to uphold the Department’s 

determination that “community” and “service area” are equivalent, arguing that this 

“perfectly fits the purpose of the statute” because both are considered when calculating 

the need for a given service area. 

But not all regions of a service area are equivalent: while some residents 

of the Matanuska-Susitna Borough travel to Anchorage for health services, that does not 

mean similar numbers from Anchorage travel to the Matanuska-Susitna Borough. Mat41 STATEOF ALASKA, DEP’TOF HEALTH&SOC.SERVS.,ALASKA CERTIFICATE 

OF NEED REVIEW STANDARDS AND METHODOLOGIES 1 (2005), 

http://www.dhss.alaska.gov/dhcs/Documents/CertificateOfNeed/Standards.pdf. 

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Su Medical presented evidence that only 1.6% of Mat-Su Regional’s outpatients come 

from Anchorage. It is similarly likely that the majority of Alaska Spine’s current 

Anchorage patients will not travel to a relocated facility in Wasilla. This illustrates that 

facilities in the Matanuska-Susitna Borough serve a different community than facilities 

in Anchorage, despite being in the same service area. Treating these terms as equivalent 

would undermine the CON program’s purpose of ensuring an appropriate balance of 

services. 

Since its adoption in 2000, there have only been two prior determinations 

of eligibility for the relocation exemption. Both of them were for relocations within the 

same municipality: the first was a two-block move in Anchorage; the second a move 

within the city of Wasilla. There has never been an application for or grant of a 

relocation exemption for a move from one municipality to another, and no previous 

consideration of whether Anchorage and Wasilla are in the “same community.” 

TheDepartment has, however,explicitlyreferredtoAnchorageand Wasilla 

as separate communities in another related context. In approving a 2016 CON 

applicationfor long-termcarefacilitiesin theMatanuska-SusitnaValley, theDepartment 

noted that “[t]he CON Program considers the three communities of Anchorage, Wasilla 

and Palmer to be a single service area. The CON Program, in the history of its practice, 

hasnever excluded onecommunity or divided theAnchorage/Matanuska-SusitnaValley 

service area when calculating need [for long-term care facilities].” The Department 

distinguished community fromservicearea,treating Anchorageas aseparatecommunity 

from Wasilla. Consistent with the regulatory definition of service area that treats 

“community” as a subset within a “service area,” the Department’s CON program 

identified multiple communities within the service area. The Department’s past practice 

in administering the CON program does not support its determination that Anchorage 

and Wasilla are the same community. 

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V. CONCLUSION 

The Department’s grant of the exemption was incorrect. We accordingly 

AFFIRM the superior court’s grant of Mat-Su Medical’s cross-motion for summary 

judgment and its denial of Alaska Spine’s motion for summary judgment. 

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