Governor Newsom announces up to $3.3 billion of Prop 1 funding for treatment of seriously ill & homeless
What you need to know: Just four months after passage, Governor Newsom today announced the availability of up to $3.3 billion in competitive grant funding to develop a wide range of behavioral health treatment settings for Californians who most need care. He is also debuting a new primer for counties which explains how to spend the ongoing Behavioral Health Services Act revenue on housing interventions.
Sacramento, California – Today, Governor Gavin Newsom announced the release of up to $3.3 billion in competitive grant funding from Proposition 1 to expand the behavioral health continuum and provide appropriate care to individuals experiencing mental health conditions and substance use disorders — with a particular focus on people who are most seriously ill, vulnerable, or homeless. Proposition 1 includes two parts: a $6.4 billion Behavioral Health Bond for treatment settings and housing with services, and historic reform of the Behavioral Health Services Act (BHSA) to focus on people with the most serious illnesses, substance disorders, and housing needs.
The state is also releasing the Proposition 1 Behavioral Health Services Act: Housing Supports Primer (July 2024) for counties, which explains how to spend the ongoing BHSA revenue on housing interventions. Per Proposition 1, 30% of county BHSA funds each year must be directed to housing supports for people with serious behavioral health needs, including allowable ongoing capital to build more housing options. Based on projections for Fiscal Year 2026-2027, the total statewide housing funding will be approximately $950 million annually to help ensure the longevity of these projects. The Proposition 1 Behavioral Health Services Act: Housing Supports Primer (July 2024) can be found HERE and a high-level fact sheet be found HERE.
“Treatment and housing with services for our most at-risk and vulnerable family members and neighbors continues to be a priority for my administration, which is why we’re moving at an unprecedented speed to get this money out the door.
“California is not only investing billions of dollars to build new treatment settings, but also sharing a new primer for counties to help them understand how to direct nearly $1 billion of the state’s annual, ongoing behavioral health investment toward housing interventions.
“We are not taking our foot off the gas, and I am proud to see the work you enabled with your vote on Proposition 1 come to life as we move quickly to build a California that is truly for all.”
Governor Gavin Newsom
Grant details
Through the California Department of Health Care Services (DHCS), the Proposition 1 Bond Behavioral Health Continuum Infrastructure Program (BHCIP) Round 1: Launch Ready Request for Application (RFA) is now live. Applications are due from cities, counties, non-profits, for-profits, and tribal entities on December 13, 2024, and are anticipated to be awarded by early 2025. A second round of funding from Proposition 1 bonds will support even more behavioral health facilities in 2025. BHCIP funding made possible by the bond is estimated to create 6,800 residential treatment beds and 26,700 outpatient treatment slots for behavioral health and will build on other major behavioral health initiatives in California. A fact sheet on the first round of Proposition 1 bond construction funding can be found HERE.
Annual funding details
Per Proposition 1, 30% of county BHSA allocations each year will be dedicated to housing supports of behavioral health, beginning in 2026. Based on estimated revenue for FY 2026-2027, county allocations for the housing component will be approximately $950 million annually. In addition, to allow counties to address their different local needs and priorities, counties may transfer funding to increase this component up to an additional 14% or decrease funding by up to 7% by transferring funding between the two other BHSA funding components (Full Service Partnerships and behavioral health services and supports). Currently, counties are permitted to spend their existing Mental Health Services Act (MHSA) funding on housing supports, as the primer details.
Bigger picture
California is modernizing the behavioral health delivery system to improve accountability, increase transparency, and expand the capacity of behavioral health care facilities for Californians. Through BHCIP, DHCS has already competitively awarded $1.7 billion in grants to construct, acquire, and expand properties and invest in mobile crisis infrastructure for behavioral health. Proposition 1 increases funding opportunities to expand BHCIP to serve even more Californians with mental health and substance use disorders.
What’s next for Prop 1?
The Department of Housing and Community Development (HCD), in collaboration with the California Department of Veterans Affairs (CalVet), will oversee up to $2 billion in Proposition 1 funds to build permanent housing with onsite services for veterans and others who are homeless or at risk of homelessness and have mental health or substance use disorder challenges. HCD is expected to provide guidance for potential grantees by late 2024.
DHCS also plans to release the RFA for up to $1.1 billion funding round, Bond BHCIP Round 2: Unmet Needs, in May 2025, with all funds awarded by 2026.
Together, these three rounds will invest the voter-approved Prop 1 $6.4 billion to build California’s behavioral health care system and improve health and wellness for all.
Learn more and apply
Interested applicants can view the RFA for more details about eligibility requirements. To be considered “launch ready,” eligible entities must meet the criteria specified in the RFA. For more information about Bond BHCIP Round 1: Launch Ready, please visit the BHCIP website.
Information about housing supports related to the BHSA is available here More information about California’s transformation of our entire mental health and substance use disorder system can be found at mentalhealth.ca.gov.