Board of Investments says it has executed buy/sell for land west of Laurel as state behavioral health plan advances

Dan Villa, executive director of the Montana Board of Investments, told the City of Laurel at a Jan. 20 workshop that BOI has executed “a buy/sell agreement to purchase approximately 114 acres located west of Laurel along Highway 10” and will begin the formal process of seeking annexation and zoning from the city.

Villa read materials that BOI submitted with the Department of Public Health and Human Services outlining a plan approved by the state budget director that proposes a new behavioral health facility authorized by House Bill 5. The materials say HB 5 directs a transfer of $26.5 million for the project, that the site selection and facility type must be adopted by the budget director before that transfer, and that BOI and DPHHS will report progress to the interim budget committees through 2026.

DPHHS's documentation, which Villa presented to the council, describes a proposed 32‑bed forensic mental health facility intended to address mounting forensic waitlists and competency restoration needs. The plan stresses a flexible design so wings or pods could be repurposed later for civil inpatient use if demand shifts. The DPHHS materials say the Legislature’s $26.5 million allocation may be insufficient for a “hardened” forensic facility and identify a state special revenue capital balance (Behavioral Health Systems for Future Generations) as a potential backstop should additional funds be needed.

In the council workshop, Villa said BOI and DPHHS “look forward to working closely with city staff, elected officials, and community members throughout this process.” He told council members that BOI will oversee construction using its real‑estate development process and that, upon completion, DPHHS would enter a lease with BOI (the draft plan Villa provided anticipates a lease term of at least 20 years).

City staff and councilors asked procedural questions but recorded no formal City decision at the workshop. Chief Administrative Officer Kurt Markegard later provided a written explanation to BOI clarifying why the City of Laurel had not self‑nominated a site: the parcel Villa described lies outside city limits and would require annexation under an existing City resolution (R08‑22) and Montana annexation law, which includes a public hearing process.

What happens next: BOI said it will seek annexation and zoning approvals from the City and that additional community engagement and technical reviews will follow. Per HB 5 language read to the council, the budget director must adopt a jointly developed plan before the state treasurer’s transfer of HB 5 funds would occur; BOI and DPHHS will report progress to the Health and Human Services interim budget committee and the long‑range planning budget committee through Dec. 31, 2026.

Provenance: Dan Villa read the BOI/DPHHS announcement and related plan documents at the Jan. 20 City of Laurel workshop (materials and remarks included in the meeting record).