Thanks. The odd thing is it only loses the alpha type when I drag from Browser to Timeline. In other words when I first open it in the File Browser and look at it in the Inspector Media Tab the Alpha Channel is correct so there’s no reason to change it.
The giveaway for me was I was using the same psd in two places. The first time I dragged it to Canvas. That worked. Later in the project I dragged it to the timeline and the alpha seemed gone.
When I went to the Media Tab (Layers area) I noticed one iteration had the expected checkerboard background and the 2nd one had white. Selecting THAT one (slightly different fix than yours because the original version in the Browser does show the alpha correctly) and changing that in the Inspector fixed it. In this case the alpha showed as NONE.
In other words, in my case ONLY dragging into Timeline created the alpha issue and only with that use of the original source file. The very same source dragged from Browser to Canvas worked.
Odd and bug and very awkward bug for sure. Once again thanks for pointing me where to look to fix it.