Opinion ID: 2466469
Heading Depth: 3
Heading Rank: 1

Heading: Because AS 47.07.020(m) Is A Valid Retroactive Statute, We Affirm The Division's Temporary Denial Of Benefits.

Text: As noted in the legislative history above, AS 47.07.020(m) states that the department shall impose a penalty period of ineligibility for the transfer of an asset for less than fair market value by an applicant or an applicant's spouse consistent with 42 U.S.C. 1396p(c)(1). The latter federal statute consists of a rule concerning the start date for asset transfer penalty periods. [27] This rule would establish September 1, 2008, as the penalty start date for Sarah's gift, just as the Division concluded in its temporary denial of her application for Medicaid. When AS 47.07.020(m) was originally signed in July 2006, it was accompanied by a problematic conditional effective date based on the assumption that the federal government would approve Alaska's revised Medicaid plan in its entirety on a single occasion. [28] This never came to pass. In May 2008, the legislature passed S.B. 259, which repealed the conditional effective date and replaced it with a retroactive effective date of October 1, 2006. [29] This retroactive effective date preceded Sarah's February 2007 transfer of assets, and the passage into law of S.B. 259 preceded her September 2008 application for Medicaid. The State argues that the Division correctly applied 47.07.020(m) to this case. [30] We agree. Alaska Statute 01.10.090 states: No statute is retrospective unless expressly declared therein. We have explained retroactivity as follows: A statute will be considered retroactive insofar as it gives to pre-enactment conduct a different legal effect from that which it would have had without passage of the statute. A statute creates this different legal effect if it would impair rights a party had when he acted, increase a party's liability for past conduct, or impose new duties with respect to transactions already completed.[ [31] ] John acknowledges that AS 01.10.090 allows statutes to have retroactive effect if they expressly declare their retroactivity, as is the case with the post-May 2008 version of AS 47.07.020(m). [32] But he argues that the retroactive application of AS 47.07.020(m) to Sarah's asset transfer would constitute an unlawful taking and be an unconstitutional ex post facto law under the Alaska and U.S. Constitutions. On the first point, John specifically argues that the retroactive application of AS 47.07.020(m) to his mother's gift would violate the takings clauses of the Alaska and U.S. Constitutions. Article I, section 18 of the Alaska Constitution states: Private property shall not be taken or damaged for public use without just compensation. The Fifth Amendment to the U.S. Constitution similarly provides that private property shall not be taken for public use, without just compensation. [33] We address two initial questions in determining whether an unconstitutional taking has occurred: (1) whether the claimant has a property interest protected by the takings clause; and (2) if so, whether the government action in question effected a taking of that property without just compensation. [34] John's argument fails based on the first prong. In order to determine whether a claimant has a property interest protected by the takings clause, we examine whether the claimant's right or property interest has vested. [35] Because Sarah had not applied for or been granted Medicaid benefits prior to the retroactivity amendment in May 2008, any interest she had in such benefits had not vested prior to May 2008. [36] Thus the retroactivity amendment affecting AS 47.07.020(m) could not have constituted a taking. Our decision in Underwood v. State [37] provides a close precedent. There, we considered the constitutional claims of a family that timed its move to Alaska in reliance on eligibility rules for the Permanent Fund Dividend (PFD) that the legislature changed after the family's arrival, rendering the family ineligible for the 1993 PFD. [38] We held that because the family possessed nothing more than an inchoate expectancy of a 1993 PFD that is not afforded constitutional protection, [39] the family had no property right whatsoever in a 1993 PFD, [40] and thus they had no property that could have been the subject of a taking in violation of the Fifth Amendment of the Federal Constitution and Article I, section 18 of the Alaska Constitution. [41] Similarly, when Sarah made her gift to John in February 2007, she had nothing more than an inchoate expectancy of eventually being eligible for Medicaid benefits based on her estate planning strategy. She had no vested right in receiving such benefits by virtue of that strategy. Thus she had no property that could have formed the subject of a taking in violation of either the Alaska or U.S. Constitutions. [42] John defends Sarah's claim by arguing that the taking in question was not the taking of her Medicaid benefits, but the taking of her vested right to dispose of her property as she sees fit. This argument conflicts with the uncontested facts of the case. The government did not confiscate Sarah's $120,000 gift to John. It is not the case that the State of Alaska revoked a monetary gift or revoked a completed transaction when it temporarily denied Sarah's application. The State simply refused to grant her low-income medical assistance so long as a close family member controlled assets that had been hers a short while before and would have been sufficient to pay for her care. John's second constitutional argument against the retroactive application of AS 47.07.020(m) to Sarah's Medicaid application is that such an application violates the prohibition against ex post facto laws in article I, section 15 of the Alaska Constitution. But the prohibition against ex post facto laws concerns the retroactive application of penal statutes, [43] and is thus unrelated to the facts of this case. Finally, John introduces several arguments on appeal that we deem waived. He argues in his reply brief that AS 47.07.020(m) is not controlling because it is merely enabling legislation, and implies that it cannot withstand a fairness and reasonableness review. The former argument is briefed in cursory fashion without citation to legal authority, [44] the latter argument is little more than implied, and both arguments are introduced for the first time in John's reply brief. As such, they are waived. [45]