I am writing on behalf of the Association of Minority -Owned ALF (AMOA), which represents state-regulated Assisted Living Facilities (ALFs). These facilities provide essential care for the impoverished and disenfranchised, receiving minimal compensation. The Joint Legislative Audit and Review Commission (JLARC) has noted that the Auxiliary Grant is below fair housing market value.

The proposed regulation, 22VAC40-73, requires our small businesses to bear the burden of minimum liability insurance without corresponding financial support. This requirement will severely impact our ability to provide housing for individuals with mental disabilities.

The regulation fails to consider the differences among assisted living facilities. Auxiliary grant beds, which are primarily residential and offer a homelike environment, should not be classified the same as pseudo nursing homes that employ medical professionals and provide extensive medical assistance. If the Department of Social Services had collaborated with insurance companies to develop a practical tier classification system, it could have provided a viable solution. However, as it stands, the current proposal is merely theoretical, lacking a solid foundation. Insurance companies can disregard these tiers, leaving us exposed to unnecessary million-dollar policies. 

Consequently, insurance companies struggle to classify our smaller industry appropriately. A million-dollar policy for a thirty-bed facility earning only $70 per day is unreasonable, especially when compared to facilities earning $1000 per day. This disparity is not only unfair but also economically oppressive, threatening the survival of small black-owned businesses. 

For over twenty years, the AMOA has advocated for our industry, yet we have received no relief from these harsh and burdensome regulations. Implementing this new regulation without providing the means to sustain it sets us up for failure once again. Insurance agencies operate without restraints, able to drop clients without warning, shut down after taking deposits and financing, and deny coverage if it is not profitable for them.

We urge you to reconsider the implementation of this regulation and provide the necessary support to ensure the continued operation of our facilities.

Thank you for your attention to this critical matter.