California voters will vote on Proposition 1 in March, which could change local behavioral wellness program funding and structure.
The multi-pronged legislation attempts to modernize the 2004 Mental Health Services Act (MHSA)—a personal income tax measure that established the current structure of county behavioral wellness programs—and add a $6.4 billion bond measure to build 10,000 new beds to help those with serious mental illness and substance use disorders get the housing and help they need, according to Gov. Gavin Newsom’s office.
“We are facing a confluence of crises: Mental health, opioids, housing, and homelessness—and this transformation effort will ensure California is tackling these head-on in a comprehensive and inclusive way,” Newsom said in a statement. “Over the last few years, California has led the nation in expanding access to affordable and quality mental health services—especially for children, teens, and people with untreated mental illness. The historic legislative effort … will supercharge these efforts to ensure California continues to lead the way in the decades to come.”
Proposition 1 is split into three parts, SLO County Behavioral Health Deputy Director Frank Warren told the Sun. The first is a bond that aims to generate funds for immediate short-term residential housing throughout the state, while the other two parts focus on behavioral health reform.
“The third part is a reform of the Mental Health Services Act, and this is where it gets layered for us,” he said. “Right now, our Mental Health Services Act has a formula based on your Medi-Cal population, your poverty rates, and that’s how fund amounts are calculated for counties.”
The MHSA was designed to expand and transform California’s behavioral health system to better serve individuals with and at risk of serious mental health issues and their families, provide early intervention, and provide for needed infrastructure, technology, and training. It’s currently funded by a 1 percent income tax on personal income in excess of $1 million per year.
In local jurisdictions, the MHSA requires mental health services to be provided in community partnership and encourages programs to meet people where they are instead of using a model that involves people walking into clinics, Warren said.
“It got counties to serve people in their communities, their schools, their family resource centers, and it focuses on people who are the most severe in inpatient units, crisis services, jails, and hospitals,” he said. “It also created a continuum in the mental health world that involves prevention and early intervention, so that we can address issues with young people who have a very early signs of risk.”
Proposition 1 takes the MHSA and refocuses it to stabilizing folks who are the most challenged by their conditions and getting them to a place where they can benefit from ongoing treatment programs and take steps toward long-term recovery, Santa Barbara County Behavioral Wellness Director Toni Navarro told the Sun.
“Any time something has been in place for 20 years, an overhaul is always welcome,” Navarro said. “The overall thing to remember with the Mental Health Services Act reform and Proposition 1 is that it’s a shifting of the funds—some from the county to state—shifting how we allocate the funds, but it’s no additional, new money.”
The MHSA requires counties to use these programs to serve individuals with severe and persistent mental illnesses or co-occurring disorders, Navarro said. Santa Barbara County established five funding “buckets” through the act—community services and supports like outpatient treatment and crisis services; prevention and early intervention programs for ages 0 to 25 and 25 and older; innovation to solving Santa Barbara County-specific issues; workforce education and training programs; and capital facilities upgrades.
Proposition 1 would shift $140 million of existing MHSA funds from counties to the state, reducing local funds for programs, and adds people experiencing substance use disorders as eligible for programming, according to the Legislative Analyst’s Office. In Santa Barbara County, this presents an estimated 58 percent decrease in funding for outpatient treatment and crisis services with a 30 percent increase in the population served, Navarro said.
The good news, Navarro said, is there are a lot of changes under California Advancing and Innovating in Medical (CalAIM)—an initiative that allows the state insurance Medi-Cal to reimburse behavioral health programs through insurance claims—that could help the county keep dollars in place for its treatment programs, she said.
“We are going to do our best to … leverage the opportunities in CalAIM to mitigate any losses should Proposition 1 pass,” she said. “When you look at it, if it passes, it has so many glaring things that seem to be impacting the system. … The hope is we are going to stretch our limbs, and it gives us an opportunity to revamp the system.”
Full-service partnerships—the most intensive, outpatient treatment programs that provide wraparound services and see individuals multiple times a week—will receive a 6.5 percent increase in funding, and early intervention and prevention programs for both age groups will see a 17 percent increase total if the legislation passes.
“Now we get to the third bucket, which is housing,” Navarro said. “We currently spend $5 million on housing—we pay for shelter beds, board and care, certain types of crisis residential facility beds. … Under the reallocation of [Proposition 1] it would be an additional almost $7.5 million a year.”
Thirty percent of the housing allocation must be spent on individuals who are chronically homeless (a minimum of 12 months in unsheltered care), she said.
“I think initially it is going to be a great support for our community, but over time we are building facilities to bring people into care faster [and] that could be a challenge,” she said.
The $6.4 billion bond is not just for individuals served under the MHSA, but for veterans and other individuals with mental health disorders, she said.
“We will have some flexibility, but I don’t think there’s much clarity as to the distribution of the bond,” Navarro said.
SLO County’s Warren said that although Proposition 1 passing means that SLO’s MHSA funding could be reduced to a third, a lot of good could also come out of it, such as mandatory reporting for all county services to ensure transparency with residents.
“Certainly, a focus on housing is something that we all believe in, especially for people who are suffering from mental illness or addiction,” he said. “Housing is the best way to get them treated and keep them sustaining their treatment, so we’re excited about that. We’ll just be forced to make some really tough decisions.”
Warren said that while they’re waiting on the proposition’s outcome, his team is collecting data abouts which programs are most at risk of losing funding.
“In the current Mental Health Services Act, there’s a requirement to do innovation programs that test new models and strategies. They are short-term funded projects that help you determine what’s the best way to serve a certain population,” he said. “This new reform would take away that requirement.”
If the measure passes in the March 5 primary, local jurisdictions will finish out their current three-year MHSA plans and shift under the new requirements by July 1, 2026, Santa Barbara County Behavioral Wellness Director Navarro added.
“Whether or not it passes, just this whole process has us thinking about our own programs and what our country needs locally,” she said. “With all these other new initiatives coming our way … we’re making sure we leverage those opportunities to make a [more] responsive system for Santa Barbara County residents.”
Reach Staff Writer Samantha Herrera at the Sun’s sister paper, New Times, at sherrera@newtimesslo.com. Reach Staff Writer Taylor O’Connor at toconnor@santamariasun.com.
This article appears in Feb 22 – Mar 3, 2024.