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How will Proposition 1 Affect Mental Health Services?

In California, rates of mental illness have been steadily rising, but legislation has not kept pace. Can SB 326 and AB 531, 2 new bills around mental health care, make a difference?





Written by Alice Zhao and Daphne

Illustrated by Heidi Chin

Edited by Praghna Palaparthy


“Nearly 1 in 7 California adults experiences a mental illness, and one in 26 has a serious mental illness that makes it difficult to carry out daily activities. 1 in 14 children has an emotional disturbance that limits functioning in family, school, or community activities,” reported the California Health Care Foundation in 2022. As mental health issues become more prevalent, it is clear that California needs to accommodate the greater need for mental health services.


Proposition 1 aims to restructure the existing mental health system in California and expand it to include programs with treatment for substance use disorders and support homeless people who struggle with substance abuse disorders or mental illness. This proposition, which includes Senate Bill 362 (SB 362) and Assembly Bill 531 (AB 531), will appear on the California ballot in March 2024.


Though there have been many attempts to create services that aid people who struggle with mental illness (including those aiming to help homeless people with mental health disorders) since the 1990s, there was no legislation passed to create a cohesive outline for a statewide mental health system until the Mental Health Service Act (MHSA) was passed in 2004.


There have been no changes to the MHSA in the twenty years it has been active, but Proposition 1 intends to change that. AB 531 plans to spend billions of dollars building housing for homeless individuals suffering from substance abuse and severe mental illness combines with SB 362’s plan to expand upon the MHSA, such as making conservatorship more accessible and outlining programs to address drug use problems, to restructure and expand California’s mental health care system.


The MHSA was developed to restructure and fund the mental health system in counties across California by focusing on both early prevention and recovery programs. Since its implementation in 2005, funding from the MHSA now makes up over 24% of the funding for public mental health services statewide. While the act has funded successful projects, such as pre-existing FSP programs and the No Place Like Home program (which includes a 2 million dollar bond used to develop the permanent supportive housing needed to help homeless people in need of mental health support), critics highlight the lack of both transparency and organization when it comes to spending funds and supporting underfunded projects.


This is where Senate Bill 362 comes in, with an ambitious plan to reform and expand services in the MHSA. The bill proposes that the services outlined by the MHSA be expanded to include support for those with substance abuse disorders. This includes changing the name of the Mental Health Service Act to the Behavioral Health Service Act (BHSA) and a redistribution of the BHSA funds to include services for people with substance abuse disorders.


The majority of the money needed to realize BSHA will come from the $6.38 billion general obligation bond from AB 531 with supplemental funding from MSHA. 

The majority of the general obligation bond will be used for building 11,150 treatment beds and supportive housing units, as well as increasing the number of treatment slots by 26,700, making up $4.4 billion of the allotted amount. In this $4.4 billion is a $1.5 billion fund set aside for local governments to apply for as needed. In addition to the creation of thousands of new temporary accommodations, $2 billion will be used to create permanent housing units. $1.056 billion worth of this housing will be specifically for homeless veterans and individuals suffering from substance abuse disorders. 


From a percentage viewpoint of BSHA, 90% of its funding will go into reforming mental health and substance abuse services while the other 10% will be used in investments towards increasing awareness of drug abuse treatment programs and mental health services as well as training a culturally-competent labor force. Of the 90%, 30% of the money will be used to stage interventions for homeless individuals with substance abuse disorders and severe mental illnesses, 35% to FSP (Full Service Partnership) programs, and the final 35% will go into early intervention and training to support Behavioral Health Services.  


Currently,  MSHA levies a 1% tax on individuals with incomes greater than $1 million to help fund its mental health and substance abuse programs, which goes to each county to use delegates as they wish. With the new changes, however, counties will be required to put 30% of that money into housing assistance to aid Project Homekey, which is a statewide program that provides local governments with the funds they need to turn abandoned buildings such as hotels and vacant apartment buildings and fix them up into long-term or permanent housing for the homeless and those at risk of becoming homeless.. Counties will also face limitations on how MSHA funding is spent to better account for how the money is being spent. 


According to the Newsom administration, these bills should increase California’s capabilities to deal with current levels of mental health issues. Those who are suffering from substance abuse will have interventions and be given temporary housing to help them recover. 


Judges will be given greater power to court order individuals with severe untreated mental health issues, involuntarily putting them through treatment. This is because Senate Bill 43  increases the law’s definition of who is considered to be “gravely disabled,” which is now defined as any individual who cannot provide their necessities due to drug addiction or mental health issues. This bill is now working with SB 236 and AB 531,allowing courts to put these individuals under court-appointed conservatorship. 


FSP programs will be instructed to enact a “whatever it takes” approach to overcoming mental illness. These new reforms are said to transform current services into all-intensive and client-driven programs that will provide a large range of available mental health staff, from highly trained clinicians to para-professionals. Overall, FSP programs will be broken down into sub-programs based on age to provide for the specific needs of all, such as helping adults find employment. 


AB 531 plans to build upon Project Homekey. The addition of this bill on top of the pre-existing project to solve the homelessness crisis will add another billion dollars worth of support specifically for veterans and those with substance abuse disorders. 

With these outlined plans, it seems reasonable to believe that these additional steps will prove to help solve homelessness. However, some doubt should be cast due to the overall ineffectiveness of Homekey so far. According to research done by Kerry Jackson and Wayne Winegarden at the Pacific Research Institute, the number of homeless has increased despite Gov. Newsom’s claims otherwise. 


Jackson and Winegarden have pointed out that Homekey does not address the issues that cause people to become homeless in the first place: mental illness and addiction. Proposition 1, which is supposed to address those issues, could then potentially solve the shortcomings of Homekey. 


Those in support of Proposition 1 believe that this can fix the state’s broken healthcare system and update it with a more modern understanding of mental illness. Those who suffer the worst mental health issues will finally get the support they need in Newsom’s new “treatment not tents” policy. Not only will Proposition 1 be working to solve the homelessness crisis it will also be supporting children and teenagers with their age-based sub-programs. These bills bring supporters hope that they will allow the gravely disabled the chance to recover and live the rest of their lives with dignity and independence. 


Despite these apparent benefits, many fear that these new bills are going in the wrong direction towards a past of institutional care that involuntarily held people and took away their autonomy and independence.  It is the belief that Proposition 1 favors forcing those backing this bill to deem “greatly disabled” which could increase the amount of abusive conservatorships. Especially with the removal of words such as “voluntary” in an amendment of AB 531, critics feel that they have the right to be apprehensive of the new legislation’s effectiveness. 


The idea to expand and reform California’s mental health care system and treatment for the homeless is an efficient step in the right direction, especially after having neglected to make such changes for decades. However,  due to a lack of results, while attempting to solve similar problems, such as Project Homekey, it is hard not to believe that this may be another case of spending careless amounts of money in hopes that it solves the problem. Due to the steps being taken to ensure better accountability of where funds are going and directly addressing the issues that Homekey has ignored, there is hope that this project may be successful.

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