Bill Text: CA SB326 | 2023-2024 | Regular Session | Amended

California Senate Bill 326 (Prior Session Legislation)

NOTE: There are more recent revisions of this legislation. Read Latest Draft

Bill Title: The Behavioral Health Services Act.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Passed) 2023-10-12 - Chaptered by Secretary of State. Chapter 790, Statutes of 2023. [SB326 Detail]

Download: California-2023-SB326-Amended.html

Amended IN Assembly June 19, 2023

Amended IN Senate March 21, 2023

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Senate Bill

No. 326

Introduced by Senator Eggman

February 07, 2023

An act to ~~amend Section 5891 of the Welfare and Institutions Code, relating to mental health.~~ amend, repeal, and add Section 99277 of the Education Code, to amend, repeal, and add Section 131315 of the Health and Safety Code, to amend, repeal, and add Section 19602.5 of the Revenue and Taxation Code, to amend, repeal, and add Section 1095.5 of the Unemployment Insurance Code, to amend Sections 5600.3, 5604, 5604.1, 5604.2, 5604.3, 5604.5, 5613, 5614, 5675, 5813.6, and 5878.2 of, to amend and repeal Sections 5840.8, 5846, 5847, 5848, 5895, and 5899 of, to amend, repeal, and add Sections 5610, 5771.1, 5805, 5806, 5813.5, 5814, 5830, 5835, 5835.2, 5840, 5840.6, 5840.7, 5845, 5845.5, 5848.5, 5849.1, 5849.2, 5849.3, 5852.5, 5868, 5878.1, 5878.3, 5881, 5886, 5890, 5891, 5891.5, 5892, 5892.1, 5892.5, 5893, 5897, 5898, 14191.7, and 14707.5 of, to add Sections 5831 and 14197.71 to, to add Chapter 3 (commencing with Section 5840.10) to Part 3.6 of Division 5 of, to add Part 4.1 (commencing with Section 5887) to Division 5 of, to add Chapter 3 (commencing with Section 5962) to Part 7 of Division 5 of, and to repeal Section 5840.5 of the Welfare and Institutions Code, and to amend and repeal Section 18 of the Mental Health Services Act, as added by Proposition 63 at the November 2, 2004, statewide general election, relating to behavioral health.

LEGISLATIVE COUNSEL'S DIGEST

SB 326, as amended, Eggman. ~~Mental Health Services Act.~~ The Behavioral Health Services Act.

(1) Existing law, the Mental Health Services Act (MHSA), an initiative measure enacted by the voters as Proposition 63 at the November 2, 2004, statewide general election, funds a system of county mental health plans for the provision of mental health services. Existing law authorizes the MHSA to be amended by a ²/₃ vote of the Legislature if the amendments are consistent with and further the intent of the MHSA. Existing law authorizes the Legislature to add provisions to clarify procedures and terms of the MHSA by majority vote.
If approved by the voters at the March 5, 2024, statewide primary election, this bill would delete the provision that establishes vote requirements to amend the MHSA, requiring all amendments of the MHSA to be approved by the voters. The bill would recast the MHSA by, among other things, renaming it the Behavioral Health Services Act (BHSA), expanding it to include treatment of substance use disorders, changing the county planning process, and expanding services for which counties and the state can use funds. The bill would revise the distribution of MHSA moneys, including allocating up to $36,000,000 to the department for behavioral health workforce funding. The bill would authorize the department to require a county to implement specific evidence-based practices.
This bill would require a county, for behavioral health services eligible for reimbursement pursuant to the federal Social Security Act, to submit the claims for reimbursement to the State Department of Health Care Services (the department) under specific circumstances. The bill would require counties to pursue reimbursement through various channels and would authorize the counties to report issues with managed care plans and insurers to the Department of Managed Health Care or the Department of Insurance.
The MHSA establishes the Mental Health Services Oversight and Accountability Commission and requires it to adopt regulations for programs and expenditures for innovative programs and prevention and early intervention programs established by the act. Existing law requires counties to develop plans for innovative programs funded under the MHSA.
This bill would rename the commission the Behavioral Health Services Oversight and Accountability Commission and would change the composition and duties of the commission, as specified. The bill would delete the provisions relating to innovative programs and instead would require the department to establish the priorities and a program, which would be administered by counties, to provide housing interventions. The bill would provide that “low rent housing project,” as defined, does not apply to the development of urban or rural dwellings, apartments, or other living accommodations, as specified.
This bill would make extensive technical and conforming changes.
(2) Existing law, the Bronzan-McCorquodale Act, contains provisions governing the operation and financing of community mental health services for persons with mental disorders in every county through locally administered and locally controlled community mental health programs. Existing law further provides that, to the extent resources are available, community mental health services should be organized to provide an array of treatment options in specified areas, including, among others, case management and individual service plans. Under existing law, mental health services are provided through contracts with county mental health programs.
The bill would authorize the State Department of Health Care Services to develop and revise documentation standards for individual service plans, as specified. The bill would revise the contracting process, including authorizing the department to temporarily withhold funds or impose monetary sanctions on a county behavioral health department that is not in compliance with the contract.
(3) Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services, including Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) services for an individual under 21 years of age. The Medi-Cal program is, in part, governed by, and funded pursuant to, federal Medicaid program provisions. Existing law requires the department, in collaboration with the California Health and Human Services Agency and in consultation with the Mental Health Services Oversight and Accountability Commission, to create a plan for a performance outcomes system for EPSDT mental health services, as specified.
This bill would include substance use disorder treatment services provided to eligible Medi-Cal beneficiaries under 21 years of age in the plan for a performance outcome system.
(4) The bill would provide that its provisions are severable.
(5) The bill would provide for the submission of the act to the voters at the March 5, 2024, statewide primary election.
Existing law, the Mental Health Services Act, an initiative measure enacted by the voters as Proposition 63 at the November 2, 2004, statewide general election, funds a system of county mental health plans for the provision of mental health services, as specified. The act establishes the Mental Health Services Fund, which is continuously appropriated to, and administered by, the State Department of Health Care Services to fund specified county mental health programs. The act may be amended by the Legislature only by a 23 vote of both houses and only so long as the amendment is consistent with and furthers the intent of the act. The Legislature may clarify procedures and terms of the act by majority vote.
This bill would require a county, for a behavioral health service eligible for reimbursement pursuant to the federal Social Security Act, to submit the claims for reimbursement to the State Department of Health Care Services under specific circumstances. By imposing a new duty on local officials, this bill would create a state-mandated local program.
~~The bill would make findings that it clarifies procedures and terms of the Mental Health Services Act.~~
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.

Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: ~~YES~~NO

The people of the State of California do enact as follows:

SECTION 1.
The people of the State of California hereby find and declare all the following:
(a) The data is alarming. In 2022, one in 20 adults in California is living with a serious mental illness (SMI), representing a nearly 50-percent increase in the last decade. One in 13 children in California has a serious emotional disturbance (SED), which is more common in children in low-income families, and 30 percent of youth 12 to 24 years of age experience serious psychological distress. One in 10 Californians meet the criteria for a substance use disorder (SUD), and the rate of SUDs among youth 18 to 25 years of age is nearly twice that of adults and more than three times that of adolescents.
(b) The number of amphetamine-related emergency department (ED) visits increased nearly 50 percent between 2018 and 2020, while the number of non-heroin-related opioid, including fentanyl, ED visits more than doubled in the same period. The total cost of care for individuals with behavioral health conditions who use emergency departments and inpatient services is roughly two times higher than those who do not. Hospitals have reported a significant increase in the number of adolescents seeking psychiatric treatment in emergency departments.
(c) Black, indigenous, and communities of color, younger and older individuals, people who are LGBTQ+, victims of domestic violence or sexual abuse, veterans, people involved with the justice system, and people who are experiencing homelessness, among others, are the most impacted.
(d) Black, indigenous, and people of color (BIPOC) experience disparities in access to health care, which may contribute to and sustain racial inequities in behavioral health care. Latinx, Asian, and Pacific Islander Medi-Cal enrollees have the lowest rates of access to services of all racial and ethnic groups and are less likely to have continued engagement with behavioral health services across both managed care and county specialty plans.
(e) Nationally, suicide rates among youth between 10 and 18 years of age have increased, as has the rate for Black and Latinx youth between 10 and 24 years of age in California. LGBTQ+ youth are over four times more likely to attempt suicide than non-LGBTQ+ peers, while multiple suicide risk factors may affect adults 65 years of age and older, including psychiatric and neurocognitive disorders, social exclusion, bereavement, cognitive impairment, and physical illnesses.
(f) Veterans have a higher rate of suicide than the general population and experience higher rates of mental illness or substance use disorder. In 2020, there were over 10,000 Californian veterans experiencing homelessness.
(g) Nearly one-quarter of California’s homeless population have an SMI and are at higher risk of justice involvement. Among recently incarcerated individuals, data suggests that close to one in three people experiencing homelessness are living with an SMI. Overdose is the leading cause of death for people recently released from incarceration.
(h) Meeting the growing demand for behavioral health care has exposed strained infrastructure. There are workforce challenges across professional classifications that do not easily facilitate a career pathway to meet the need for holistic and compassionate behavioral health care and positions that provide a living wage. The current workforce is not diverse enough or culturally representative of those in need. The limited availability of clinically appropriate, culturally competent, community-based care facilities and residential settings to support rehabilitation and recovery contributes to the growing crisis of homelessness and incarceration among those living with an SMI and an SUD. Research in 2021 indicates that the state has a shortage of over 2,700 subacute and nearly 3,000 community residential beds.
(i) More can be done to support capacity, access, and quality of required behavioral health care for individuals who are insured. Enhanced fiscal and programmatic oversight is needed to prevent insured individuals experiencing behavioral health challenges from needing publicly resourced care through the county specialty behavioral health system. By improving planning and administration, performance monitoring, and accountability, individual service and system level outcomes will improve.

SEC. 2.
The purposes and intent in enacting this act are as follows:
(a) The state intends to transform its behavioral health system while strengthening the continuum of community-based care options for Californians living with the most significant mental health and substance use disorder (SUD) needs. These efforts include, but are not limited to, California Advancing and Innovating Medi-Cal (CalAIM), Behavioral Health Community-Based Organized Networks of Equitable Care and Treatment (BH-CONNECT), Children and Youth Behavioral Health Initiative (CYBHI), Behavioral Health Continuum Infrastructure Program (BHCIP), Community Assistance, Recovery, and Empowerment (CARE) Act, the 988 Suicide and Crisis Lifeline, and the Crisis Care Continuum.
(b) Further transformation of the behavioral health system requires modernization to account for changes in the health care and behavioral health landscape since the Mental Health Services Act was enacted 20 years ago, including the passage and implementation of the federal Patient Protection and Affordable Care Act, which expanded coverage and required essential health benefits, including behavioral health benefits, for individuals insured under Medicaid. In addition, federal and state parity laws have expanded access to services and affordable coverage. Funding sources should not only be maximized to the fullest extent possible, but must be blended and braided, to leverage public resources for where the unmet need is greatest.
(c) The state continues to align goals and further policies that support delivery system improvements. This includes advancing the use of evidence-based and community-defined evidence programs, taking a whole person approach that is trauma informed, developmentally tailored across the lifespan, streamlined and seamless service delivery, supports the individual in the recovery process, reduces health disparities, and acts in partnership with families and support systems.
(d) The state intends to strengthen oversight over key outcomes so that investments are being made in equitable and high-quality care. Outcome measures, not just process measures, will drive toward meaningful and measurable system change. Transparency will increase and revised planning processes will allow strategic alignment of funding and local cross-system collaboration.
(e) The state recognizes the critical role that safe, stable, and affordable housing play in supporting individuals with a serious mental illness (SMI) and an SUD to thrive in their communities. Therefore, dedicated resources towards essential housing interventions for those experiencing a serious emotional disturbance (SED), an SMI, and an SUD are needed for those experiencing, or who are at risk of experiencing, homelessness.
(f) Additionally, the state will lead enhanced efforts to address workforce challenges by recruiting, training, and creating a pathway to high-quality jobs that can meet the growing behavioral health care needs of Californians with culturally competent care provided in multiple languages by a diverse workforce. Investments to address the growing demand for quality behavioral health care services across professional classifications should be additive to the workforce and not cause the displacement of any county employee providing direct behavioral health services.
(g) Efforts to streamline the process for approving projects and renovating or building new facilities to accelerate the delivery of care in residential settings made available through additional Behavioral Health Services Act and bond financing is a priority.
(h) Overall, this measure furthers California’s transformation of the behavioral health care system, specifically strengthening the continuum of care for the most vulnerable Californians and the system as a whole. It provides substantial state investment and streamlines the construction of community behavioral health residential settings, modernizes the Mental Health Services Act, and improves statewide accountability and access to behavioral health services. Collectively these connected initiatives provide tools to help Californians with their unique behavioral health challenges.

SEC. 3.

Section 99277 of the Education Code is amended to read:

99277.

(a) Upon receiving funding for purposes of this chapter, UCSF, the UC college named in Section 92200, and the UC/CSU California Collaborative on Neurodiversity and Learning shall each appoint one member from the respective institutions. This group shall be charged with the development and oversight of the initiative, and shall function as the institute’s management committee. The management committee shall be permitted, but not obligated, to retain a program director to assist in the implementation of the initiative.

(b) An advisory board, with its title and members to be named by the institute, shall be established to serve as an oversight body for the initiative in order to monitor progress and provide leadership from the perspectives of their respective participating organizations, departments, and divisions, and to facilitate collaboration among researchers, practitioners, administrators, legislators, and community stakeholders. The advisory board shall provide expertise and support to the management committee. The membership of the advisory board shall be constituted as set forth in subdivision ~~(b).~~ (c). The advisory board shall be a check on accountability in order to ensure that the initiative is meeting its goals. The advisory board shall also conduct a fiscal review of the distribution of funds to ensure alignment with the goals of the initiative.

(c) The members of the advisory board shall be representatives from the following institutions, organizations, agencies, and groups:

(1) UCSF.

(2) UC college named in Section 92200.

(3) The UC/CSU California Collaborative for Learning and Neurodiversity.

(4) The Mental Health Services Oversight and Accountability Commission.

(5) A Member of the Assembly selected by the Speaker of the Assembly.

(6) A Senator selected by the President pro Tempore of the Senate.

(7) Community representatives, including formerly justice-involved persons and their family members, selected by the Governor, the Speaker of the Assembly, and the President pro Tempore of the Senate.

(d) The advisory board shall meet twice per year, with the potential for additional working group meetings. At each meeting, the advisory board shall participate in a review of reports, including updates on research, practice, and policy efforts, as well as fiscal reporting.

(e) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall remain in effect only until January 1, 2025, and as of that date is repealed.

SEC. 4.

Section 99277 is added to the Education Code, to read:

99277.
(a) Upon receiving funding for purposes of this chapter, UCSF, the UC college named in Section 92200, and the UC/CSU California Collaborative on Neurodiversity and Learning shall each appoint one member from the respective institutions. This group shall be charged with the development and oversight of the initiative and shall function as the institute’s management committee. The management committee shall be permitted, but not obligated, to retain a program director to assist in the implementation of the initiative.
(b) (1) An advisory board, with its title and members to be named by the institute, shall be established to serve as an oversight body for the initiative in order to monitor progress and provide leadership from the perspectives of their respective participating organizations, departments, and divisions and to facilitate collaboration among researchers, practitioners, administrators, legislators, and community stakeholders.
(2) The advisory board shall provide expertise and support to the management committee.
(3) The advisory board shall be a check on accountability to ensure that the initiative is meeting its goals.
(4) The advisory board shall conduct a fiscal review of the distribution of funds to ensure alignment with the goals of the initiative.
(5) The membership of the advisory board shall be constituted as set forth in subdivision (c).
(c) The members of the advisory board shall be representatives from the following institutions, organizations, agencies, and groups:
(1) UCSF.
(2) UC college named in Section 92200.
(3) The UC/CSU California Collaborative for Learning and Neurodiversity.
(4) The Behavioral Health Services Oversight and Accountability Commission.
(5) A Member of the Assembly selected by the Speaker of the Assembly.
(6) A Senator selected by the President pro Tempore of the Senate.
(7) Community representatives, including formerly justice-involved persons and their family members, selected by the Governor, the Speaker of the Assembly, and the President pro Tempore of the Senate.
(d) (1) The advisory board shall meet twice per year, with the potential for additional working group meetings.
(2) At each meeting, the advisory board shall participate in a review of reports, including updates on research, practice, and policy efforts, as well as fiscal reporting.
(e) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 5.

Section 131315 of the Health and Safety Code is amended to read:

131315.

If the Office of Suicide Prevention is established pursuant to Section 131300, all of the following shall apply:

(a) The Office of Suicide Prevention shall consult with the Mental Health Services Oversight and Accountability Commission to implement suicide prevention efforts consistent with the Mental Health Services Oversight and Accountability Commission’s Suicide Prevention Report “Striving for Zero” and described pursuant to Provision 1 of Item 4560-001-3085 of Section 2.00 of the Budget Act of 2020.

(b) This section does not authorize the Office of Suicide Prevention to perform any of the duties required by the commission under Part 3.7 (commencing with Section 5845) of Division 5 of, or administer any program funded by Part 4.5 (commencing with Section 5890) of Division 5 of, the Welfare and Institutions Code.

(c) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall remain in effect only until January 1, 2025, and as of that date is repealed.

SEC. 6.

Section 131315 is added to the Health and Safety Code, to read:

131315.
(a) If the Office of Suicide Prevention is established pursuant to Section 131300, both of the following shall apply:
(1) The Office of Suicide Prevention shall consult with the Behavioral Health Services Oversight and Accountability Commission to implement suicide prevention efforts consistent with the Suicide Prevention Report “Striving for Zero,” as described pursuant to Provision 1 of Item 4560-001-3085 of Section 2.00 of the Budget Act of 2020.
(2) This section does not authorize the Office of Suicide Prevention to perform any of the duties required by the commission under Part 3.7 (commencing with Section 5845) of Division 5 of, or administer a program funded by Part 4.5 (commencing with Section 5890) of Division 5 of, the Welfare and Institutions Code.
(b) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 7.

Section 19602.5 of the Revenue and Taxation Code is amended to read:

19602.5.

(a) There is in the State Treasury the Mental Health Services Fund (MHS Fund). The estimated revenue from the additional tax imposed under Section 17043 for the applicable fiscal year, as determined under subparagraph (B) of paragraph (3) of subdivision (c), shall be deposited to the MHS Fund on a monthly basis, subject to an annual adjustment as described in this section.

(b) (1) Beginning with fiscal year 2004–2005 and for each fiscal year thereafter, the Controller shall deposit on a monthly basis in the MHS Fund an amount equal to the applicable percentage of net personal income tax receipts as defined in paragraph (4).

(2) (A) Except as provided in subparagraph (B), the applicable percentage referred to in paragraph (1) shall be 1.76 percent.

(B) For fiscal year 2004–2005, the applicable percentage shall be 0.70 percent.

(3) Beginning with fiscal year 2006–2007, monthly deposits to the MHS Fund pursuant to this subdivision are subject to suspension pursuant to subdivision (f).

(4) For purposes of this subdivision, “net personal income tax receipts” refers to amounts received by the Franchise Tax Board and the Employment Development Department under the Personal Income Tax Law, as reported by the Franchise Tax Board to the Department of Finance pursuant to law, regulation, procedure, and practice (commonly referred to as the “102 Report”) in effect on the effective date of the act establishing this section.

(c) No later than March 1, 2006, and each March 1 thereafter, the Department of Finance, in consultation with the Franchise Tax Board, shall determine the annual adjustment amount for the following fiscal year.

(1) The “annual adjustment amount” for any fiscal year shall be an amount equal to the amount determined by subtracting the “revenue adjustment amount” for the applicable revenue adjustment fiscal year, as determined by the Franchise Tax Board under paragraph (3), from the “tax liability adjustment amount” for applicable tax liability adjustment tax year, as determined by the Franchise Tax Board under paragraph (2).

(2) (A) (i) The “tax liability adjustment amount” for a tax year is equal to the amount determined by subtracting the estimated tax liability increase from the additional tax imposed under Section 17043 for the applicable year under subparagraph (B) from the amount of the actual tax liability increase from the additional tax imposed under Section 17043 for the applicable tax year, based on the returns filed for that tax year.

(ii) For purposes of the determinations required under this paragraph, actual tax liability increase from the additional tax means the increase in tax liability resulting from the tax of 1 percent imposed under Section 17043, as reflected on the original returns filed by October 15 of the year after the close of the applicable tax year.

(iii) The applicable tax year referred to in this paragraph means the 12-calendar month taxable year beginning on January 1 of the year that is two years before the beginning of the fiscal year for which an annual adjustment amount is calculated.

(B) (i) The estimated tax liability increase from the additional tax for the following tax years is:

Tax Year	Estimated Tax Liability Increase from the Additional Tax
2005	$634 million
2006	$672 million
2007	$713 million
2008	$758 million

(ii) The “estimated tax liability increase from the additional tax” for the tax year beginning in 2009 and each tax year thereafter shall be determined by applying an annual growth rate of 7 percent to the “estimated tax liability increase from additional tax” of the immediately preceding tax year.

(3) (A) The “revenue adjustment amount” is equal to the amount determined by subtracting the “estimated revenue from the additional tax” for the applicable fiscal year, as determined under subparagraph (B), from the actual amount transferred for the applicable fiscal year.

(B) (i) The “estimated revenue from the additional tax” for the following applicable fiscal years is:

Applicable Fiscal Year	Estimated Revenue from Additional Tax
2004–05	$254 million
2005–06	$683 million
2006–07	$690 million
2007–08	$733 million

(ii) The “estimated revenue from the additional tax” for applicable fiscal year 2007–08 and each applicable fiscal year thereafter shall be determined by applying an annual growth rate of 7 percent to the “estimated revenue from the additional tax” of the immediately preceding applicable fiscal year.

(iii) The applicable fiscal year referred to in this paragraph means the fiscal year that is two years before the fiscal year for which an annual adjustment amount is calculated.

(d) The Department of Finance shall notify the Legislature and the Controller of the results of the determinations required under subdivision (c) no later than 10 business days after the determinations are final.

(e) If the annual adjustment amount for a fiscal year is a positive number, the Controller shall transfer that amount from the General Fund to the MHS Fund on July 1 of that fiscal year.

(f) If the annual adjustment amount for a fiscal year is a negative number, the Controller shall suspend monthly transfers to the MHS Fund for that fiscal year, as otherwise required by paragraph (1) of subdivision (b), until the total amount of suspended deposits for that fiscal year equals the amount of the negative annual adjustment amount for that fiscal year.

(g) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall remain in effect only until January 1, 2025, and as of that date is repealed.

SEC. 8.

Section 19602.5 is added to the Revenue and Taxation Code, to read:

19602.5.
(a) There is in the State Treasury the Behavioral Health Services (BHS) Fund. The estimated revenue from the additional tax imposed under Section 17043 for the applicable fiscal year, as determined under subparagraph (B) of paragraph (3) of subdivision (c), shall be deposited to the BHS Fund on a monthly basis, subject to an annual adjustment as described in this section.
(b) (1) Each fiscal year, the Controller shall deposit on a monthly basis in the BHS Fund an amount equal to the applicable percentage of net personal income tax receipts as defined in paragraph (4).
(2) The applicable percentage referred to in paragraph (1) shall be 1.76 percent.
(3) Monthly deposits to the BHS Fund pursuant to this subdivision are subject to suspension pursuant to subdivision (f).
(4) For purposes of this subdivision, “net personal income tax receipts” refers to amounts received by the Franchise Tax Board and the Employment Development Department under the Personal Income Tax Law, as reported by the Franchise Tax Board to the Department of Finance pursuant to law, regulation, procedure, and practice (commonly referred to as the “102 Report”) in effect on the effective date of the act establishing this section.
(c) No later than March 1, 2006, and each March 1 thereafter, the Department of Finance, in consultation with the Franchise Tax Board, shall determine the annual adjustment amount for the following fiscal year.
(1) The “annual adjustment amount” for a fiscal year shall be an amount equal to the amount determined by subtracting the “revenue adjustment amount” for the applicable revenue adjustment fiscal year, as determined by the Franchise Tax Board under paragraph (3), from the “tax liability adjustment amount” for applicable tax liability adjustment tax year, as determined by the Franchise Tax Board under paragraph (2).
(2) (A) (i) The “tax liability adjustment amount” for a tax year is equal to the amount determined by subtracting the estimated tax liability increase from the additional tax imposed under Section 17043 for the applicable year under subparagraph (B) from the amount of the actual tax liability increase from the additional tax imposed under Section 17043 for the applicable tax year, based on the returns filed for that tax year.
(ii) For purposes of the determinations required under this paragraph, actual tax liability increase from the additional tax means the increase in tax liability resulting from the tax of 1 percent imposed under Section 17043 as reflected on the original returns filed by October 15 of the year after the close of the applicable tax year.
(iii) The applicable tax year referred to in this paragraph means the 12-calendar month taxable year beginning on January 1 of the year that is two years before the beginning of the fiscal year for which an annual adjustment amount is calculated.
(B) The “estimated tax liability increase from the additional tax” for each tax year shall be determined by applying an annual growth rate of 7 percent to the “estimated tax liability increase from additional tax” of the immediately preceding tax year.
(3) (A) The “revenue adjustment amount” is equal to the amount determined by subtracting the “estimated revenue from the additional tax” for the applicable fiscal year, as determined under subparagraph (B), from the actual amount transferred for the applicable fiscal year.
(B) (i) The “estimated revenue from the additional tax” for each applicable fiscal year shall be determined by applying an annual growth rate of 7 percent to the “estimated revenue from the additional tax” of the immediately preceding applicable fiscal year.
(ii) The applicable fiscal year referred to in this paragraph means the fiscal year that is two years before the fiscal year for which an annual adjustment amount is calculated.
(d) The Department of Finance shall notify the Legislature and the Controller of the results of the determinations required under subdivision (c) no later than 10 business days after the determinations are final.
(e) If the annual adjustment amount for a fiscal year is a positive number, the Controller shall transfer that amount from the General Fund to the BHS Fund on July 1 of that fiscal year.
(f) If the annual adjustment amount for a fiscal year is a negative number, the Controller shall suspend monthly transfers to the BHS Fund for that fiscal year, as otherwise required by paragraph (1) of subdivision (b), until the total amount of suspended deposits for that fiscal year equals the amount of the negative annual adjustment amount for that fiscal year.
(g) To the extent that there are moneys remaining in the Mental Health Services Fund on the date this section becomes operative, those moneys shall be transferred to the Behavioral Health Services Fund. Amounts owed or encumbered at the time of transfer shall be used in the manner required by the MHSA. Any funds not owed or encumbered by the MHSA may be used in the same manner as any other moneys in the BHS Fund.
(h) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 9.

Section 1095.5 of the Unemployment Insurance Code is amended to read:

1095.5.

(a) (1) The director shall permit the use of any information in ~~his or her~~ their possession to the extent necessary to enable the Mental Health Services Oversight and Accountability Commission to receive quarterly wage data of mental health consumers served by the California public mental health system for the purpose of monitoring and evaluating employment outcomes to determine the effectiveness of those ~~services, and may~~ services.

(2) The director may require reimbursement for all direct costs incurred in providing any ~~and all~~ information specified in this section. ~~The~~

(3) The information shall be provided to the extent permitted under applicable federal statute and regulation.

(b) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall remain in effect only until January 1, 2025, and as of that date is repealed.

SEC. 10.

Section 1095.5 is added to the Unemployment Insurance Code, to read:

1095.5.
(a) (1) The director shall permit the use of any information in their possession to the extent necessary to enable the Behavioral Health Services Oversight and Accountability Commission to receive quarterly wage data of individuals with a mental health disorder or a substance use disorder, or both, served by the California public mental health and substance use disorder system for the purpose of monitoring and evaluating employment outcomes to determine the effectiveness of those services.
(2) The director may require reimbursement for all direct costs incurred in providing any information specified in this section.
(3) The information shall be provided to the extent permitted under applicable federal statute and regulation.
(b) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 11.

Section 5600.3 of the Welfare and Institutions Code is amended to read:

5600.3.

To the extent resources are available, the primary goal of the use of funds deposited in into the mental health account of the local health and welfare trust fund ~~should~~ shall be to serve the target populations identified in the following categories, which ~~shall not be construed as establishing~~ do not establish an order of priority:

~~(a)(1)Seriously emotionally disturbed children or adolescents.~~
(a) (1) Children or youth who have a serious emotional disturbance.

(2) For the purposes of this part, ~~“seriously emotionally disturbed children or adolescents”~~ “children or youth who have a serious emotional disturbance” means minors under ~~the age of~~ 18 years of age who have a mental ~~disorder~~ illness as identified in the most recent edition of the Diagnostic and Statistical Manual of Mental Disorders, other than a primary substance use disorder or developmental disorder, which results in behavior inappropriate to the child’s age according to expected developmental norms. Members of this target population shall meet one or more of the following criteria:

(A) As a result of the mental ~~disorder,~~ illness, the child has substantial impairment in at least two of the following areas: self-care, school functioning, family relationships, or the ability to function in the community; and either of the following occur:

(i) The child is at risk of removal from home or has already been removed from the home.

(ii) The mental ~~disorder~~ illness and impairments have been present for more than six months or are likely to continue for more than one year without treatment.

(B) The child displays one of the following: psychotic features, risk of ~~suicide~~ suicide, or risk of violence due to a mental ~~disorder.~~ illness.

(C) The child has been assessed pursuant to Article 2 (commencing with Section 56320) of Chapter 4 of Part 30 of Division 4 of Title 2 of the Education Code and determined to have an emotional ~~disturbance,~~ disturbance as defined in paragraph (4) of subdivision (c) of Section 300.8 of Title 34 of the Code of Federal Regulations.

(b) (1) Adults and older adults who have a serious mental ~~disorder.~~ illness.

(2) (A) (i) For the purposes of this part, “serious mental ~~disorder”~~ illness” means a mental ~~disorder~~ illness that is severe in degree and persistent in duration, which may cause behavioral functioning ~~which~~ that interferes substantially with the primary activities of daily living, and which may result in an inability to maintain stable adjustment and independent functioning without treatment, support, and rehabilitation for a long or indefinite period of time. ~~Serious mental disorders~~

(ii) Serious mental illnesses include, but are not limited to, schizophrenia, bipolar disorder, post-traumatic stress disorder, as well as major affective disorders or other severely disabling mental ~~disorders. This~~ illnesses.

(B) This section ~~shall not be construed to~~ does not exclude persons with a serious mental ~~disorder~~ illness and a diagnosis of substance abuse, developmental disability, or other physical or mental ~~disorder.~~ illness.

(3) Members of this target population shall meet all of the following criteria:

(A) The person has a mental ~~disorder~~ illness as identified in the most recent edition of the Diagnostic and Statistical Manual of Mental Disorders, other than a substance use ~~disorder or~~ disorder, developmental ~~disorder~~ disorder, or acquired traumatic brain injury pursuant to subdivision (a) of Section 4354 unless that person also has a serious mental ~~disorder~~ illness as defined in paragraph (2).

(B) (i) As a result of the mental ~~disorder,~~ illness, the person has substantial functional impairments or ~~symptoms,~~ symptoms or a psychiatric history demonstrating that without treatment there is an imminent risk of decompensation to having substantial impairments or symptoms.

(ii) For the purposes of this part, “functional impairment” means being substantially impaired as the result of a mental ~~disorder~~ illness in independent living, social relationships, vocational skills, or physical condition.

(C) As a result of a mental functional impairment and circumstances, the person is likely to become so disabled as to require public assistance, services, or entitlements.

(4) For the purpose of organizing outreach and treatment options, to the extent resources are available, this target population includes, but is not limited to, persons who are any of the following:

(A) Homeless persons ~~who are mentally ill.~~ with serious mental illness.

(B) Persons evaluated by appropriately licensed persons as requiring care in acute treatment facilities including state hospitals, acute inpatient facilities, institutes for mental disease, and crisis residential programs.

(D) Persons who require acute treatment as a result of a first episode of mental illness with psychotic features.

(5) (A) California veterans in need of mental health or substance use disorder treatment services and who meet the existing eligibility requirements of this section, shall be provided services to the extent services are available to other adults pursuant to this section. ~~Veterans~~

(B) A veteran who may be eligible for mental health or substance use disorder treatment services through the United States Department of Veterans Affairs ~~should~~ shall be advised of these services by the county and assisted in linking to those services, to the extent possible, but the eligible veteran shall not be denied county mental or behavioral health services while waiting for a determination of eligibility for, and availability of, ~~mental or~~ behavioral health services provided by the United States Department of Veterans Affairs.

~~(A)~~

(C) An eligible veteran shall not be denied county mental health or substance use disorder treatment services based solely on ~~his or her~~ their status as a veteran, including whether ~~or not~~ the person is eligible for services provided by the United States Department of Veterans Affairs.

~~(B)~~

(D) Counties shall refer a veteran to the county veterans service officer, if any, to determine the veteran’s eligibility for, and the availability of, mental health or substance use disorder treatment services provided by the United States Department of Veterans Affairs or other federal health care provider.

~~(C)~~

(E) Counties ~~should~~ shall consider contracting with community-based veterans’ services agencies, where possible, to provide high-quality, ~~veteran specific~~ veteran-specific mental health or substance use disorder treatment services.

(c) Adults or older adults who ~~require~~ require, or are at risk of ~~requiring~~ requiring, acute psychiatric inpatient care, residential treatment, or outpatient crisis intervention because of a mental ~~disorder~~ illness with symptoms of psychosis, suicidality, or violence.

(d) Persons who need brief treatment as a result of a natural disaster or severe local emergency.

SEC. 12.

Section 5604 of the Welfare and Institutions Code is amended to read:

5604.

(a) (1) (A) Each community mental health service shall have a ~~mental~~ behavioral health board consisting of 10 to 15 members, depending on the preference of the county, appointed by the governing body, except that ~~boards in counties~~ a board in a county with a population of fewer than 80,000 may have a minimum of ~~five~~ 5 members. A

(B) A county with more than five supervisors shall have at least the same number of members as the size of its board of supervisors. ~~This~~

(C) This section does not limit the ability of the governing body to increase the number of members above 15.

(2) (A) (i) The board shall serve in an advisory role to the governing body, and one member of the board shall be a member of the local governing body. ~~Local mental~~

(ii) Local behavioral health boards may recommend appointees to the county supervisors. ~~The~~

(iii) The board membership ~~should~~ shall reflect the diversity of the client population in the county to the extent possible.

(B) (i) Fifty percent of the board membership shall be consumers, or the parents, spouses, siblings, or adult children of consumers, who are receiving or have received ~~mental~~ behavioral health services. At

(ii) At least 20 percent of the total membership shall be consumers, and at least 20 percent shall be families of consumers.

(C) (i) In ~~counties~~ a county with a population of 100,000 or more, at least one member of the board shall be a veteran or veteran advocate. In ~~counties~~ a county with a population of fewer than 100,000, the county shall give a strong preference to appointing at least one member of the board who is a veteran or a veteran advocate.

(ii) To comply with clause (i), a county shall notify its county veterans service officer about vacancies on the board, if a the county has a veterans service officer.

(D) (i) In addition to the requirements in subparagraphs (B) and (C), counties are encouraged to appoint individuals who have experience with, and knowledge of, the ~~mental~~ behavioral health ~~system. This~~ systems.

(ii) This would include members of the community ~~that~~ who engage with individuals living with mental illness or substance use disorder in the course of daily operations, such as representatives of county offices of education, large and small businesses, hospitals, hospital districts, physicians practicing in emergency departments, city police chiefs, county sheriffs, and community and nonprofit service providers.

(3) (A) In ~~counties~~ a county with a population that is fewer than 80,000, at least one member shall be a consumer and at least one member shall be a parent, spouse, sibling, or adult child of a consumer who is receiving, or has received, mental health or substance use disorder treatment services.

(B) Notwithstanding subparagraph (A), a board in a county with a population that is fewer than 80,000 that elects to have the board exceed the five-member minimum permitted under paragraph (1) shall be required to comply with paragraph (2).

(b) (1) The ~~mental~~ behavioral health board shall review and evaluate the local public mental health system, pursuant to Section 5604.2, and ~~advise~~ review and evaluate the local public substance use disorder treatment system.

(2) The behavioral health board shall advise the governing body on community mental health and substance use disorder services delivered by the local mental health agency or local behavioral health agency, as applicable.

(2) The governing body shall equitably stagger the appointments so that approximately one-third of the appointments expire in each year.

(d) If two or more local agencies jointly establish a community mental health service pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code, the ~~mental~~ behavioral health board for the community mental health service shall consist of an additional two members for each additional agency, one of whom shall be a consumer or a parent, spouse, sibling, or adult child of a consumer who has received mental health or substance use disorder treatment services.

(e) (1) Except as provided in paragraph (2), a member of the board or the member’s spouse shall not be a full-time or part-time county employee of a county mental health and substance use disorder service, an employee of the State Department of Health Care Services, or an employee of, or a paid member of the governing body of, a mental health or substance use disorder contract agency.

(2) (A) A consumer of ~~mental~~ behavioral health services who has obtained employment with an employer described in paragraph (1) and who holds a position in which the consumer does not have ~~any~~ an interest, influence, or authority over ~~any~~ a financial or contractual matter concerning the employer may be appointed to the board. ~~The~~

(B) The member shall abstain from voting on ~~any~~ a financial or contractual issue concerning the member’s employer that may come before the board.

(f) Members of the board shall abstain from voting on ~~any~~ an issue in which the member has a financial interest as defined in Section 87103 of the Government Code.

(g) If it is not possible to secure membership as specified in this section from among persons who reside in the county, the governing body may substitute representatives of the public interest in ~~mental~~ behavioral health who are not full-time or part-time employees of the county ~~mental~~ behavioral health service, the State Department of Health Care Services, or on the staff of, or a paid member of the governing body of, a ~~mental~~ behavioral health contract agency.

(h) The ~~mental~~ behavioral health board may be established as an advisory board or a commission, depending on the preference of the county.

(i) For purposes of this section, “veteran advocate” means either a parent, spouse, or adult child of a veteran, or an individual who is part of a veterans organization, including the Veterans of Foreign Wars or the American Legion.

SEC. 13.

Section 5604.1 of the Welfare and Institutions Code is amended to read:

5604.1.

Local ~~mental~~ behavioral health ~~advisory boards shall be~~ boards are subject to the provisions of Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code, relating to meetings of local agencies.

SEC. 14.

Section 5604.2 of the Welfare and Institutions Code is amended to read:

5604.2.

(a) The local ~~mental~~ behavioral health board shall do all of the following:

(1) Review and evaluate the community’s public ~~mental~~ behavioral health needs, services, facilities, and special problems in ~~any~~ a facility within the county or jurisdiction where mental health or substance use disorder evaluations or services are being provided, including, but not limited to, schools, emergency departments, and psychiatric facilities.

(2) (A) Review ~~any~~ county agreements entered into pursuant to Section 5650. ~~The~~

(B) The local ~~mental~~ behavioral health board may make recommendations to the governing body regarding concerns identified within these agreements.

(3) (A) Advise the governing body and the local ~~mental~~ behavioral health director as to any aspect of the local ~~mental~~ behavioral health ~~program. Local mental~~ systems.

(B) Local behavioral health boards may request assistance from the local patients’ rights advocates when reviewing and advising on mental health or substance use disorder evaluations or services provided in public facilities with limited access.

(4) (A) Review and approve the procedures used to ensure citizen and professional involvement at all stages of the planning process. ~~Involvement~~

(B) Involvement shall include individuals with lived experience of mental ~~illness~~ illness, substance use disorder, or both, and their families, community members, advocacy organizations, and ~~mental~~ behavioral health professionals. It shall also include other professionals ~~that~~ who interact with individuals living with mental illnesses or substance use disorders on a daily basis, such as education, emergency services, employment, health care, housing, ~~law enforcement,~~ public safety, local business owners, social services, ~~seniors,~~ older adults, transportation, and veterans.

(5) Submit an annual report to the governing body on the needs and performance of the county’s ~~mental~~ behavioral health system.

(6) (A) Review and make recommendations on applicants for the appointment of a local director of ~~mental~~ behavioral health services. ~~The~~

(B) The board shall be included in the selection process prior to the vote of the governing body.

(7) Review and comment on the county’s performance outcome data and communicate its findings to the California Behavioral Health Planning Council.

(8) This part does not limit the ability of the governing body to transfer additional duties or authority to a ~~mental~~ behavioral health board.

(b) It is the intent of the Legislature that, as part of its duties pursuant to subdivision (a), the board shall assess the impact of the realignment of services from the state to the ~~county,~~ county on services delivered to clients and on the local community.

SEC. 15.

Section 5604.3 of the Welfare and Institutions Code is amended to read:

5604.3.

(a) (1) The board of supervisors may pay from ~~any~~ available funds the actual and necessary expenses of the members of the ~~mental~~ behavioral health board of a community mental health service incurred incident to the performance of their official duties and functions. ~~The~~

(2) The expenses may include travel, lodging, childcare, and meals for the members of ~~an advisory~~ the board while on official business as approved by the director of the local ~~mental~~ behavioral health program.

(b) Governing bodies are encouraged to provide a budget for the local ~~mental health board,~~ behavioral health board using planning and administrative revenues identified in subdivision ~~(c)~~ (d) of Section 5892, that is sufficient to facilitate the purpose, duties, and responsibilities of the local ~~mental~~ behavioral health board.

SEC. 16.

Section 5604.5 of the Welfare and Institutions Code is amended to read:

5604.5.

The local ~~mental~~ behavioral health board shall develop bylaws to be approved by the governing body ~~which~~ that shall do all of the following:

(a) Establish the specific number of members on the ~~mental~~ behavioral health board, consistent with subdivision (a) of Section 5604.

(b) Ensure that the composition of the ~~mental~~ behavioral health board represents and reflects the diversity and demographics of the county as a whole, to the extent feasible.

(d) Establish that the chairperson of the ~~mental~~ behavioral health board be in consultation with the local ~~mental~~ behavioral health director.

(e) Establish that there may be an executive committee of the ~~mental~~ behavioral health board.

SEC. 17.

Section 5610 of the Welfare and Institutions Code is amended to read:

5610.

(a) Each county mental health system shall comply with reporting requirements developed by the State Department of Health Care Services, in consultation with the California Behavioral Health Planning Council and the Mental Health Services Oversight and Accountability Commission, which shall be uniform and simplified. The department shall review existing data requirements to eliminate unnecessary requirements and consolidate requirements which are necessary. These requirements shall provide comparability between counties in reports.

(b) The department shall develop, in consultation with the Performance Outcome Committee, the California Behavioral Health Planning Council, and the Mental Health Services Oversight and Accountability Commission, pursuant to Section 5611, and with the California Health and Human Services Agency, uniform definitions and formats for a statewide, nonduplicative client-based information system that includes all information necessary to meet federal mental health grant requirements and state and federal Medicaid reporting requirements, and any other state requirements established by law. The data system, including performance outcome measures reported pursuant to Section 5613, shall be developed by July 1, 1992.

(c) Unless determined necessary by the department to comply with federal law and regulations, the data system developed pursuant to subdivision (b) shall not be more costly than that in place during the 1990–91 fiscal year.

(d) (1) The department shall develop unique client identifiers that permit development of client-specific cost and outcome measures and related research and analysis.

(2) The department’s collection and use of client information, and the development and use of client identifiers, shall be consistent with clients’ constitutional and statutory rights to privacy and confidentiality.

(3) Data reported to the department may include name and other personal identifiers. That information is confidential and subject to Section 5328 and any other state and federal laws regarding confidential client information.

(4) Personal client identifiers reported to the department shall be protected to ensure confidentiality during transmission and storage through encryption and other appropriate means.

(5) Information reported to the department may be shared with local public mental health agencies submitting records for the same person and that information is subject to Section 5328.

(e) All client information reported to the department pursuant to Chapter 2 (commencing with Section 4030) of Part 1 of Division ~~4 and~~ 4, Sections 5328 to 5772.5, inclusive, Chapter 8.9 (commencing with Section ~~14700),~~ 14700) of Part 3 of Division 9, and any other state and federal laws regarding reporting requirements, consistent with Section 5328, shall not be used for purposes other than those purposes expressly stated in the reporting requirements referred to in this subdivision.

(f) The department may adopt emergency regulations to implement this section in accordance with the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code). The adoption of emergency regulations to implement this section that are filed with the Office of Administrative Law within one year of the date on which the act that added this subdivision took effect shall be deemed to be an emergency and necessary for the immediate preservation of the public peace, health and safety, or general welfare and shall remain in effect for no more than 180 days.

(g) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 18.

Section 5610 is added to the Welfare and Institutions Code, to read:

5610.
(a) (1) Each county behavioral health system shall comply with reporting requirements developed by the State Department of Health Care Services, in consultation with the California Behavioral Health Planning Council and the Behavioral Health Services Oversight and Accountability Commission, which shall be uniform and simplified.
(2) The department shall review existing data requirements to eliminate unnecessary requirements and consolidate requirements that are necessary.
(3) These requirements shall provide comparability between counties in reports.
(b) (1) The department and the California Health and Human Services Agency shall develop, in consultation with the Performance Outcome Committee, the California Behavioral Health Planning Council, and the Behavioral Health Services Oversight and Accountability Commission, pursuant to Section 5611, uniform definitions and formats for a statewide, nonduplicative, client-based information system that includes all information necessary to meet federal mental health and substance use disorder grant requirements, state and federal Medicaid reporting requirements, and other state requirements established by law.
(2) The data system, including performance outcome measures reported pursuant to Section 5613, shall be developed by July 1, 1992.
(c) Unless determined necessary by the department to comply with federal law and regulations, the data system developed pursuant to subdivision (b) shall not be more costly than that in place during the 1990–91 fiscal year.
(d) (1) The department shall develop unique client identifiers that permit development of client-specific cost and outcome measures and related research and analysis.
(2) The department’s collection and use of client information, and the development and use of client identifiers, shall be consistent with clients’ constitutional and statutory rights to privacy and confidentiality.
(3) (A) Data reported to the department may include name and other personal identifiers.
(B) That information is confidential and subject to Section 5328 and any other state and federal law regarding confidential client information.
(4) Personal client identifiers reported to the department shall be protected to ensure confidentiality during transmission and storage through encryption and other appropriate means.
(5) (A) Information reported to the department may be shared with local public behavioral health agencies submitting records for the same person.
(B) The information described in this paragraph is subject to Section 5328.
(e) All client information reported to the department pursuant to Chapter 2 (commencing with Section 4030) of Part 1 of Division 4 and Sections 5328 to 5772.5, inclusive, Chapter 8.9 (commencing with Section 14700), and any other state and federal law regarding reporting requirements, consistent with Section 5328, shall not be used for purposes other than those purposes expressly stated in the reporting requirements referred to in this subdivision.
(f) The department may adopt emergency regulations to implement this section in accordance with the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code). The adoption of emergency regulations to implement this section that are filed with the Office of Administrative Law within one year of the date on which the act that added this subdivision took effect shall be deemed to be an emergency and necessary for the immediate preservation of the public peace, health and safety, or general welfare and shall remain in effect for no more than 180 days.
(g) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 19.

Section 5613 of the Welfare and Institutions Code is amended to read:

5613.

(a) Counties shall annually report data on performance measures established pursuant to Section 5612 to the local ~~mental~~ behavioral health ~~advisory~~ board and to the Director of Health Care Services.

(b) The Director of Health Care Services shall annually make data on county performance available to the ~~Legislature,~~ Legislature and post that data on the department’s ~~Internet Web site,~~ internet website by no later than March 15 of each year.

SEC. 20.

Section 5614 of the Welfare and Institutions Code is amended to read:

5614.

(a) The department, in consultation with the Compliance Advisory Committee that shall have representatives from relevant stakeholders, including, but not limited to, local ~~mental~~ behavioral health departments, local ~~mental~~ behavioral health boards and commissions, private and community-based providers, consumers and family members of consumers, and advocates, shall establish a protocol for ensuring that local ~~mental~~ behavioral health departments meet statutory and regulatory requirements for the provision of publicly funded community mental health services provided under this part.

(b) The protocol shall include a procedure for review and assurance of compliance for all of the following elements, and any other ~~elements~~ element required in law or regulation:

(1) Financial maintenance of effort requirements provided for under Section 17608.05.

(2) Each local ~~mental~~ behavioral health board has approved procedures that ensure citizen and professional involvement in the local mental health and substance use disorder planning process.

(3) Children’s services are funded pursuant to the requirements of Sections 5704.5 and 5704.6.

(4) The local ~~mental~~ behavioral health department complies with reporting requirements developed by the department.

(5) To the extent resources are available, the local ~~mental~~ behavioral health department maintains the program principles and the array of treatment options required under Sections 5600.2 to 5600.9, inclusive.

(6) The local ~~mental~~ behavioral health department meets the reporting required by the performance outcome systems for adults and children.

(c) (1) The protocol developed pursuant to subdivision (a) shall focus on law and regulations and shall include, but not be limited to, the items specified in subdivision (b). ~~The~~

(2) The protocol shall include data collection procedures so that state review and reporting may occur. ~~The~~

(3) The protocol shall also include a procedure for the provision of technical ~~assistance,~~ assistance and formal decision rules and procedures for enforcement consequences when the requirements of law and regulations are not met. ~~These~~

(4) These standards and decision rules shall be established through the consensual stakeholder process established by the department.

SEC. 21.

Section 5675 of the Welfare and Institutions Code is amended to read:

5675.

(a) (1) Mental health rehabilitation centers shall only be licensed by the State Department of Health Care Services subsequent to application by counties, county contract providers, or other organizations. In

(2) In the application for a mental health rehabilitation center, program evaluation measures shall include, but not be limited ~~to:~~ to, all of the following:

~~(1)~~

(A) That the clients placed in the facilities show improved global assessment ~~scores,~~ scores as measured by preadmission and postadmission tests.

~~(2)~~

(B) That the clients placed in the facilities demonstrate improved functional behavior as measured by preadmission and postadmission tests.

~~(3)~~

(C) That the clients placed in the facilities have reduced medication levels as determined by comparison of preadmission and postadmission records.

(b) The State Department of Health Care Services shall conduct annual licensing inspections of mental health rehabilitation centers.

(c) (1) All regulations relating to the licensing of mental health rehabilitation centers, heretofore adopted by the State Department of Mental Health, or its successor, shall remain in effect and shall be fully enforceable by the State Department of Health Care Services with respect to any facility or program required to be licensed as a mental health rehabilitation center, unless and until readopted, amended, or repealed by the Director of Health Care Services. ~~The~~

(2) The State Department of Health Care Services shall succeed to and be vested with all duties, powers, purposes, functions, responsibilities, and jurisdiction of the State Department of Mental Health, and its successor, if any, as they relate to licensing mental health rehabilitation centers.

(d) (1) Notwithstanding subdivision (c), pursuant to Section 5963.05, the State Department of Health Care Services may develop and revise documentation standards for individual service plans to be consistent with the standards developed pursuant to paragraph (3) of subdivision (h) of Section 14184.402.
(2) The department shall require mental health rehabilitation centers to implement these documentation standards and shall conduct annual licensing inspections and investigations to determine compliance with these standards.

SEC. 22.

Section 5771.1 of the Welfare and Institutions Code is amended to read:

5771.1.

(a) The members of the Mental Health Services Oversight and Accountability Commission established pursuant to Section 5845 are members of the California Behavioral Health Planning Council. They serve in an ex officio capacity when the council is performing its statutory duties pursuant to Section 5772. This membership does not affect the composition requirements for the council specified in Section 5771.

(b) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 23.

Section 5771.1 is added to the Welfare and Institutions Code, to read:

5771.1.
(a) The members of the Behavioral Health Services Oversight and Accountability Commission established pursuant to Section 5845 are members of the California Behavioral Health Planning Council.
(b) These members serve in an ex officio capacity when the council is performing its statutory duties pursuant to Section 5772.
(c) This membership does not affect the composition requirements for the council specified in Section 5771.
(d) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 24.

Section 5805 of the Welfare and Institutions Code is amended to read:

5805.

(a) The State Department of Health Care Services shall require counties to use available state and matching funds for the client target population as defined in Section 5600.3 to develop a comprehensive array of services as defined in Sections 5600.6 and 5600.7.

SEC. 25.

Section 5805 is added to the Welfare and Institutions Code, to read:

5805.
(a) The State Department of Health Care Services shall require counties to use available state and matching funds for the client target populations, as defined in Section 5600.3, and individuals with a substance use disorder, as defined in Section 5891.5, to develop a comprehensive array of services, as defined in Sections 5600.6 and 5600.7, and substance use disorder treatment services, as defined in Section 5891.5.
(b) A county may include services to address first episode psychosis.
(c) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 26.

Section 5806 of the Welfare and Institutions Code is amended to read:

5806.

The State Department of Health Care Services shall establish service standards that ensure that members of the target population are identified, and services provided to assist them to live independently, work, and reach their potential as productive citizens. The department shall provide annual oversight of grants issued pursuant to this part for compliance with these standards. These standards shall include, but are not limited to, all of the following:

(a) A service planning and delivery process that is target population based and includes the following:

(1) Determination of the numbers of clients to be served and the programs and services that will be provided to meet their needs. The local director of mental health shall consult with the sheriff, the police chief, the probation officer, the mental health board, contract agencies, and family, client, ethnic, and citizen constituency groups as determined by the director.

(2) Plans for services, including outreach to families whose severely mentally ill adult is living with them, design of mental health services, coordination and access to medications, psychiatric and psychological services, substance abuse services, supportive housing or other housing assistance, vocational rehabilitation, and veterans’ services. Plans also shall contain evaluation ~~strategies,~~ strategies that shall consider cultural, linguistic, gender, age, and special needs of minorities in the target populations. Provision shall be made for ~~staff~~ a workforce with the cultural background and linguistic skills necessary to remove barriers to mental health services due to limited-English-speaking ability and cultural differences. Recipients of outreach services may include families, the public, primary care physicians, and others who are likely to come into contact with individuals who may be suffering from an untreated severe mental illness who would be likely to become homeless if the illness continued to be untreated for a substantial period of time. Outreach to adults may include adults voluntarily or involuntarily hospitalized as a result of a severe mental illness.

(3) Provision for services to meet the needs of target population clients who are physically disabled.

(4) Provision for services to meet the special needs of older adults.

(5) Provision for family support and consultation services, parenting support and consultation services, and peer support or self-help group support, where appropriate for the individual.

(6) Provision for services to be client-directed and that employ psychosocial rehabilitation and recovery principles.

(7) Provision for psychiatric and psychological services that are integrated with other services and for psychiatric and psychological collaboration in overall service planning.

(8) Provision for services specifically directed to seriously mentally ill young adults 25 years of age or younger who are homeless or at significant risk of becoming homeless. These provisions may include continuation of services that still would be received through other funds had eligibility not been terminated due to age.

(9) Services reflecting special needs of women from diverse cultural backgrounds, including supportive housing that accepts children, personal services coordinator therapeutic treatment, and substance treatment programs that address gender-specific trauma and abuse in the lives of persons with mental illness, and vocational rehabilitation programs that offer job training programs free of gender bias and sensitive to the needs of women.

(10) Provision for housing for clients that is immediate, transitional, permanent, or all of these.

(11) Provision for clients who have been suffering from an untreated severe mental illness for less than one year, and who do not require the full range of services but are at risk of becoming homeless unless a comprehensive individual and family support services plan is implemented. These clients shall be served in a manner that is designed to meet their needs.

(12) Provision for services for veterans.

(b) A client shall have a clearly designated mental health personal services coordinator who may be part of a multidisciplinary treatment team who is responsible for providing or assuring needed services. Responsibilities include complete assessment of the client’s needs, development of the client’s personal services plan, linkage with all appropriate community services, monitoring of the quality and followthrough of services, and necessary advocacy to ensure that the client receives those services that are agreed to in the personal services plan. A client shall participate in the development of ~~his or her~~ their personal services plan, and responsible staff shall consult with the designated conservator, if one has been appointed, and, with the consent of the client, consult with the family and other significant persons as appropriate.

(c) The individual personal services plan shall ensure that members of the target population involved in the system of care receive age-appropriate, gender-appropriate, and culturally appropriate services or appropriate services based on any characteristic listed or defined in Section 11135 of the Government Code, to the extent feasible, that are designed to enable recipients to:

(1) Live in the most independent, least restrictive housing feasible in the local community, and for clients with children, to live in a supportive housing environment that strives for reunification with their children or assists clients in maintaining custody of their children as is appropriate.

(2) Engage in the highest level of work or productive activity appropriate to their abilities and experience.

(3) Create and maintain a support system consisting of friends, family, and participation in community activities.

(4) Access an appropriate level of academic education or vocational training.

(5) Obtain an adequate income.

(6) Self-manage their illness and exert as much control as possible over both the day-to-day and long-term decisions that affect their lives.

(7) Access necessary physical health care and maintain the best possible physical health.

(8) Reduce or eliminate serious antisocial or criminal behavior and thereby reduce or eliminate their contact with the criminal justice system.

(9) Reduce or eliminate the distress caused by the symptoms of mental illness.

(10) Have freedom from dangerous addictive substances.

(d) The individual personal services plan shall describe the service array that meets the requirements of subdivision ~~(c), and~~ (c) and, to the extent applicable to the individual, the requirements of subdivision (a).

(e) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 27.

Section 5806 is added to the Welfare and Institutions Code, to read:

5806.
(a) The State Department of Health Care Services shall establish service standards so that adults and older adults in the target population are identified and receive needed and appropriate services from qualified staff in the least restrictive environment to assist them to live independently, work, and thrive in their communities. The department shall provide annual oversight of counties for compliance with these requirements that shall include, but are not limited to, all of the following:
(1) Determination of the numbers of clients to be served and the programs and services that will be provided to meet their needs.
(2) The local director of behavioral health shall consult with the sheriff, the police chief, the probation officer, chief of emergency medical services, the behavioral health board, Medi-Cal managed care plans, as defined in subdivision (j) of Section 14184.101, child welfare departments, contract providers and agencies, and family, client, ethnic, and citizen constituency groups, as determined by the director.
(3) (A) Outreach to adults with a serious mental illness or a substance use disorder to provide coordination and access to behavioral health services, medications, housing interventions pursuant to Section 5830, supportive services, as defined in subdivision (g) of Section 5887, and veterans’ services.
(B) Service planning shall include evaluation strategies that consider cultural, linguistic, gender, age, and special needs of the target populations.
(C) Provision shall be made for a workforce with the cultural background and linguistic skills necessary to remove barriers to mental health services and substance use disorder treatment services due to limited-English-speaking ability and cultural differences.
(D) Recipients of outreach services may include families, the public, primary care physicians, hospitals, including emergency departments, behavioral health urgent care, and others who are likely to come into contact with individuals who may be suffering from either an untreated serious mental illness or substance use disorder, or both, who would likely become homeless or incarcerated if the illness continued to be untreated for a substantial period of time.
(E) Outreach to adults may include adults voluntarily or involuntarily hospitalized as a result of a serious mental illness.
(4) Provision for services for populations with identified disparities in behavioral health outcomes.
(5) Provision for full participation of the family in all aspects of assessment, service planning, and treatment, including, but not limited to, family support and consultation services, parenting support and consultation services, and peer support or self-help group support, where appropriate for the individual.
(6) Treatment for clients who have been suffering from an untreated serious mental illness or substance use disorder, or both, for less than one year and who do not require the full range of services but are at risk of becoming homeless or incarcerated unless comprehensive individual and family support services are provided consistent with the planning process specified in subdivision (d). This includes services that are available and designed to meet their needs, including housing for clients that is immediate, transitional, permanent, or all of these services.
(7) (A) Provision for services to be client-directed and to employ psychosocial rehabilitation and recovery principles.
(B) Services may be integrated with other services and may include psychiatric and psychological collaboration in overall service planning.
(8) Provision for services specifically directed to young adults 25 years of age or younger with either a serious mental illness or substance use disorder, or both, who are chronically homeless, experiencing homelessness or are at risk of homelessness, as defined in subdivision (j) of Section 5892, or experiencing first episode psychosis. These provisions may include continuation of services that still would be received through other funds had eligibility not been terminated due to age.
(9) Provision for services for frequent users of behavioral health urgent care, crisis stabilization units, and hospitals or emergency room services as the primary resource for mental health and substance use disorder treatment.
(10) Provision for services to meet the special needs of clients who are physically disabled, clients who are intellectually or developmentally disabled, veterans, or persons of American Indian or Alaska Native descent.
(11) Provision for services to meet the special needs of women from diverse cultural backgrounds, including supportive housing that accepts children, personal services coordinators, therapeutic treatment, and substance use disorder treatment programs that address gender-specific trauma and abuse in the lives of persons with either a serious mental illness or a substance use disorder, or both, and vocational rehabilitation programs that offer job training programs free of gender bias and sensitive to the needs of women.
(b) Each adult or older adult shall have a clearly designated mental health personal services coordinator or case manager who may be part of a multidisciplinary treatment team who is responsible for providing or ensuring needed behavioral health services and supportive services for individuals enrolled in full-service partnerships pursuant to Section 5887.
(c) The personal services coordinator or case manager is responsible for each adult or older adult receiving the following:
(1) A comprehensive mental health and substance use disorder assessment.
(2) Service planning with all appropriate interagency participation and developing programs and services that will meet their needs and facilitate client outcome goals.
(3) Linkage with all appropriate mental health and substance use disorder treatment services.
(4) Monitoring of the quality and followthrough of service delivery.
(5) Advocacy to ensure the provision of needed behavioral health services identified during the service planning process.
(6) A client shall participate in the service planning process, and responsible staff shall consult with the designated conservator, if one has been appointed, and, with the consent of the client, consult with the family and other significant persons as appropriate.
(7) Trauma-informed behavioral health services to reduce trauma and avoid retraumatization.
(d) The service planning process shall ensure that adults and older adults receive age-appropriate, gender-appropriate, and culturally appropriate services, or appropriate services based on a characteristic listed or defined in Section 11135 of the Government Code, to the extent feasible, that are designed to enable recipients to:
(1) (A) Live in the most independent, least restrictive housing feasible in the local community and for clients with children, to live in a supportive housing environment that strives for reunification with their children or assists clients in maintaining custody of their children, as appropriate.
(B) Assist individuals to rejoin or return to a home that had previously been maintained with a family member or in a shared housing environment that is supportive of their recovery and stabilization.
(2) Engage in the highest level of work or productive activity appropriate to their abilities and experience.
(3) Create and maintain a support system consisting of friends, family, and participation in community activities.
(4) Access an appropriate level of academic education or vocational training.
(5) Obtain an adequate income.
(6) Self-manage their illness and exert as much control as possible over both the day-to-day and long-term decisions that affect their lives.
(7) Access necessary physical health care and maintain the best possible physical health.
(8) Reduce or eliminate serious antisocial or criminal behavior and thereby reduce or eliminate their contact with the justice system.
(9) Reduce or eliminate the distress caused by the symptoms of either serious mental illness or substance use disorder, or both.
(10) Utilize trauma-informed approaches to reduce trauma and avoid retraumatization.
(e) The client’s clinical record shall describe the service array that meets the requirements of subdivisions (c) and (d) and, to the extent applicable to the individual, the requirements of subdivisions (a) and (b).
(f) For purposes of this section, “behavioral health services” shall have the meaning as defined in subdivision (j) of Section 5892.
(g) For purposes of this section, “substance use disorder” shall have the meaning as defined in subdivision (c) of Section 5891.5.
(h) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 28.

Section 5813.5 of the Welfare and Institutions Code is amended to read:

5813.5.

Subject to the availability of funds from the Mental Health Services Fund, the state shall distribute funds for the provision of services under Sections 5801, 5802, and 5806 to county mental health programs. Services shall be available to adults and seniors with severe illnesses ~~who meet the eligibility criteria~~ identified in the categories in subdivisions (b) and (c) of Section 5600.3. For purposes of this act, “seniors” means older adult persons identified in Part 3 (commencing with Section 5800) of this division.

(a) Funding shall be provided at sufficient levels to ensure that counties can provide each adult and senior served pursuant to this part with the medically necessary mental health services, medications, and supportive services set forth in the applicable treatment plan.

(b) The funding shall only cover the portions of those costs of services that cannot be paid for with other funds, including other mental health funds, public and private insurance, and other local, state, and federal funds.

(c) Each county mental health program’s plan shall provide for services in accordance with the system of care for adults and seniors who meet the eligibility criteria in subdivisions (b) and (c) of Section 5600.3.

(d) Planning for services shall be consistent with the philosophy, principles, and practices of the Recovery Vision for mental health consumers:

(1) To promote concepts key to the recovery for individuals who have mental illness: hope, personal empowerment, respect, social connections, self-responsibility, and self-determination.

(2) To promote consumer-operated services as a way to support recovery.

(3) To reflect the cultural, ethnic, and racial diversity of mental health consumers.

(4) To plan for each consumer’s individual needs.

(e) The plan for each county mental health program shall indicate, subject to the availability of funds as determined by Part 4.5 (commencing with Section 5890) of this division, and other funds available for mental health services, adults and seniors with a severe mental illness being served by this program are either receiving services from this program or have a mental illness that is not sufficiently severe to require the level of services required of this program.

(f) Each county plan and annual update pursuant to Section 5847 shall consider ways to provide services similar to those established pursuant to the Mentally Ill Offender Crime Reduction Grant Program. Funds shall not be used to pay for persons incarcerated in state prison. Funds may be used to provide services to persons who are participating in a presentencing or postsentencing diversion program or who are on parole, probation, postrelease community supervision, or mandatory supervision. When included in county plans pursuant to Section 5847, funds may be used for the provision of mental health services under Sections 5347 and 5348 in counties that elect to participate in the Assisted Outpatient Treatment Demonstration Project Act of 2002 (Article 9 (commencing with Section 5345) of Chapter 2 of Part 1), and for the provision of services to clients pursuant to Part 8 (commencing with Section 5970).

(g) The department shall contract for services with county mental health programs pursuant to Section 5897. After November 2, 2004, the term “grants,” as used in Sections 5814 and 5814.5, shall refer to those contracts.

(h) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 29.

Section 5813.5 is added to the Welfare and Institutions Code, to read:

5813.5.
Subject to the availability of funds from the Behavioral Health Services Fund, the state shall distribute funds for the provision of behavioral health services under Sections 5801, 5802, 5806, and 5891.5 to county behavioral health programs. Services shall be available to adults and older adults with serious mental illness identified in the categories in subdivisions (b) and (c) of Section 5600.3 and to adults and older adults who have a substance use disorder, as defined in subdivision (c) of Section 5891.5. For purposes of this act, “older adults” means adult persons identified in Part 3 (commencing with Section 5800).
(a) Funding shall be provided at sufficient levels to ensure counties can provide each adult and older adult served pursuant to this part with the medically necessary mental health and substance use disorder treatment services and medications identified during the service planning process pursuant to Section 5806, which are in the applicable client clinical record.
(1) To maximize federal financial participation in furtherance of subdivision (d) of Section 5890, a county shall submit claims for reimbursement to the State Department of Health Care Services in accordance with applicable Medi-Cal rules and procedures for a behavioral health service or supportive service eligible for reimbursement pursuant to Title XIX or XXI of the federal Social Security Act (42 U.S.C. Sec. 1396, et seq. and 1397aa, et seq.) when such service is paid, in whole or in part, using funds from the Behavioral Health Services Fund established pursuant to Section 5890.
(2) (A) To maximize funding from other sources, a county shall seek reimbursement for a behavioral health service, supportive service, housing intervention, prevention service, or other related activity provided pursuant to subdivision (a) of Section 5892 that is covered by or can be paid from another available funding source, including other mental health funds, substance use disorder funds, public and private insurance, and other local, state, and federal funds.
(B) A county shall make a good faith effort to contract with health care service plans and disability insurance plans, pursuant to Section 1374.72 of the Health and Safety Code and Section 10144.5 of the Insurance Code, as an in-network provider.
(C) A county shall submit requests for prior authorization for services, request letters of agreement for payment as an out-of-network provider, and pursue other means to obtain reimbursement in accordance with state and federal laws.
(3) (A) A county may report to the Department of Managed Health Care or the Department of Insurance, as appropriate, complaints about a health plan’s or a health insurer’s failure to work in good faith with the county to contract with the county or to be an in-network provider of the health plan or insurer.
(B) A county may also report to the Department of Managed Health Care or the Department of Insurance, respectively, a failure by a health plan or insurer to timely reimburse the county for services the plan or insurer must cover as required by state or federal law, including, but not limited to, Sections 1374.72 and 1374.721 of the Health and Safety Code and Sections 10144.5 and 10144.52 of the Insurance Code.
(C) Upon receipt of a complaint from a county, the Department of Managed Health Care or the Department of Insurance, as applicable, shall timely investigate the complaint.
(b) Each county behavioral health program’s integrated plan pursuant to Section 5963.02 shall provide for services in accordance with the system of care for adults and older adults identified in the categories in subdivisions (b) and (c) of Section 5600.3 or who have a substance use disorder, as defined in subdivision (c) of Section 5891.5.
(c) Planning for services shall be consistent with the philosophy, principles, and practices of the Recovery Vision for behavioral health consumers:
(1) To promote concepts key to the recovery for individuals who have a mental illness or substance use disorder, or both: hope, personal empowerment, respect, social connections, self-responsibility, and self-determination.
(2) To promote consumer-operated services as a way to support recovery.
(3) To reflect the cultural, ethnic, and racial diversity of behavioral health consumers by addressing the inequities in behavioral health service delivery.
(4) To plan for each consumer’s individual needs.
(d) The integrated plan for each county behavioral health program pursuant to Section 5963.02 shall indicate, subject to the availability of funds as determined by Part 4.5 (commencing with Section 5890) and other funds available for behavioral health services as defined in subdivision (j) of Section 5892, adults and older adults with a serious mental illness or substance use disorder, or both, being served by this program are either receiving services from this program or have a mental illness or substance use disorder that is not sufficiently severe to require the level of services required of this program.
(e) (1) Each county integrated plan and annual update pursuant to Section 5963.02 shall consider ways to provide mental health services similar to those established pursuant to the Mentally Ill Offender Crime Reduction Grant Program.
(2) Funds shall not be used to pay for persons incarcerated in state prison.
(3) Funds may be used to provide services to persons who are participating in a presentencing or postsentencing diversion program or who are on parole, probation, postrelease community supervision, or mandatory supervision or in a community reentry program.
(4) When included in county plans pursuant to Section 5963.02, funds may be used for the provision of mental health services under Sections 5347 and 5348 in counties that elect to participate in the Assisted Outpatient Treatment Demonstration Project Act of 2002 (Article 9 (commencing with Section 5345) of Chapter 2 of Part 1) and for the provision of services to clients pursuant to Part 8 (commencing with Section 5970).
(f) (1) The department shall contract for services with county behavioral health programs pursuant to Section 5897.
(2) After November 2, 2004, the term “grants,” as used in Sections 5814 and 5814.5, shall refer to those contracts.
(g) For purposes of this section, “behavioral health services” shall have the meaning as defined in subdivision (j) of Section 5892.
(h) For purposes of this section, “substance use disorder” shall have the meaning as defined in subdivision (c) of Section 5891.5.
(i) For purposes of this section, “substance use disorder treatment services” shall have the meaning as defined in subdivision (c) of Section 5891.5.
(j) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 30.

Section 5813.6 of the Welfare and Institutions Code is amended to read:

5813.6.

(a) (1) At the time of the release of the ~~January 10 budget plan and the~~ May Revision, the Director of Health Care Services shall submit to the Legislature information regarding the projected expenditure of Proposition 63 funding for each state department, and for each major program category specified in the measure, for local assistance. ~~This~~

(2) This shall include actual past-year expenditures, estimated current-year expenditures, and projected budget-year expenditures of local assistance funding. ~~In addition, it~~

(3) It shall also include a complete listing of state support expenditures for the current year and for the budget year by the State Department of Health Care Services, including the number of state positions and any contract funds. A

(4) A description of these state expenditures shall accompany the fiscal information the director is required to submit to the Legislature pursuant to this section.

(b) (1) During each fiscal year, the Director of Health Care Services shall submit to the fiscal committees of the Legislature, 30 days in advance, written notice of the intention to expend Proposition 63 local assistance funding in excess of the amounts presented in its May Revision projection for that fiscal year. ~~The~~

(2) The written notice shall include information regarding the amount of the additional spending and its purpose.

SEC. 31.

Section 5814 of the Welfare and Institutions Code is amended to read:

5814.

(a) (1) This part shall be implemented only to the extent that funds are appropriated for purposes of this part. To the extent that funds are made available, the first priority shall go to maintain funding for the existing programs that meet adult system of care contract goals. The next priority for funding shall be given to counties with a high incidence of persons who are severely mentally ill and homeless or at risk of homelessness, and meet the criteria developed pursuant to paragraphs (3) and (4).

(2) The Director of Health Care Services shall establish a methodology for awarding grants under this part consistent with the legislative intent expressed in Section 5802, and in consultation with the advisory committee established in this subdivision.

(3) (A) The Director of Health Care Services shall establish an advisory committee for the purpose of providing advice regarding the development of criteria for the award of grants, and the identification of specific performance measures for evaluating the effectiveness of grants. The committee shall review evaluation reports and make findings on evidence-based best practices and recommendations for grant conditions. At not less than one meeting annually, the advisory committee shall provide to the director written comments on the performance of each of the county programs. Upon request by the department, each participating county that is the subject of a comment shall provide a written response to the comment. The department shall comment on each of these responses at a subsequent meeting.

(B) The committee shall include, but not be limited to, representatives from state, county, and community veterans’ services and disabled veterans outreach programs, supportive housing and other housing assistance programs, law enforcement, county mental health and private providers of local mental health services and mental health outreach services, the Department of Corrections and Rehabilitation, local substance abuse services providers, the Department of Rehabilitation, providers of local employment services, the State Department of Social Services, the Department of Housing and Community Development, a service provider to transition youth, the United Advocates for Children of California, the California Mental Health Advocates for Children and Youth, the Mental Health Association of California, the California Alliance for the Mentally Ill, the California Network of Mental Health Clients, the California Behavioral Health Planning Council, the Mental Health Services Oversight and Accountability Commission, and other appropriate entities.

(4) The criteria for the award of grants shall include, but not be limited to, all of the following:

(A) A description of a comprehensive strategic plan for providing outreach, prevention, intervention, and evaluation in a cost appropriate manner corresponding to the criteria specified in subdivision (c).

(B) A description of the local population to be served, ability to administer an effective service program, and the degree to which local agencies and advocates will support and collaborate with program efforts.

(C) A description of efforts to maximize the use of other state, federal, and local funds or services that can support and enhance the effectiveness of these programs.

(5) In order to reduce the cost of providing supportive housing for clients, counties that receive a grant pursuant to this part after January 1, 2004, shall enter into contracts with sponsors of supportive housing projects to the greatest extent possible. Participating counties are encouraged to commit a portion of their grants to rental assistance for a specified number of housing units in exchange for the counties’ clients having the right of first refusal to rent the assisted units.

(b) In each year in which additional funding is provided by the annual Budget Act the State Department of Health Care Services shall establish programs that offer individual counties sufficient funds to comprehensively serve severely mentally ill adults who are homeless, recently released from a county jail or the state prison, or others who are untreated, unstable, and at significant risk of incarceration or homelessness unless treatment is provided to them and who are severely mentally ill adults. For purposes of this subdivision, ~~“severely mentally ill adults”~~ “seriously mentally ill” adults are those individuals described in subdivision (b) of Section 5600.3. In consultation with the advisory committee established pursuant to paragraph (3) of subdivision (a), the department shall report to the Legislature on or before May 1 of each year in which additional funding is provided, and shall evaluate, at a minimum, the effectiveness of the strategies in providing successful outreach and reducing homelessness, involvement with local law enforcement, and other measures identified by the department. The evaluation shall include for each program funded in the current fiscal year as much of the following as available information permits:

(1) The number of persons served, and of those, the number who receive extensive community mental health services.

(2) The number of persons who are able to maintain housing, including the type of housing and whether it is emergency, transitional, or permanent housing, as defined by the department.

(3) (A) The amount of grant funding spent on each type of housing.

(B) Other local, state, or federal funds or programs used to house clients.

(4) The number of persons with contacts with local law enforcement and the extent to which local and state incarceration has been reduced or avoided.

(5) The number of persons participating in employment service programs including competitive employment.

(6) The number of persons contacted in outreach efforts who appear to be ~~severely~~ seriously mentally ill, as described in Section 5600.3, who have refused treatment after completion of all applicable outreach measures.

(7) The amount of hospitalization that has been reduced or avoided.

(8) The extent to which veterans identified through these programs’ outreach are receiving federally funded veterans’ services for which they are eligible.

(9) The extent to which programs funded for three or more years are making a measurable and significant difference on the street, in hospitals, and in jails, as compared to other counties or as compared to those counties in previous years.

(10) For those who have been enrolled in this program for at least two years and who were enrolled in Medi-Cal prior to, and at the time they were enrolled in, this program, a comparison of their Medi-Cal hospitalizations and other Medi-Cal costs for the two years prior to enrollment and the two years after enrollment in this program.

(11) The number of persons served who were and were not receiving Medi-Cal benefits in the 12-month period prior to enrollment and, to the extent possible, the number of emergency room visits and other medical costs for those not enrolled in Medi-Cal in the prior 12-month period.

(c) To the extent that state savings associated with providing integrated services for the mentally ill are quantified, it is the intent of the Legislature to capture those savings in order to provide integrated services to additional adults.

(d) Each project shall include outreach and service grants in accordance with a contract between the state and approved counties that reflects the number of anticipated contacts with people who are homeless or at risk of homelessness, and the number of those who are severely mentally ill and who are likely to be successfully referred for treatment and will remain in treatment as necessary.

(e) All counties that receive funding shall be subject to specific terms and conditions of oversight and training, which shall be developed by the department, in consultation with the advisory committee.

(f) (1) As used in this part, “receiving extensive mental health services” means having a personal services coordinator, as described in subdivision (b) of Section 5806, and having an individual personal service plan, as described in subdivision (c) of Section 5806.

(2) The funding provided pursuant to this part shall be sufficient to provide mental health services, medically necessary medications to treat severe mental illnesses, alcohol and drug services, transportation, supportive housing and other housing assistance, vocational rehabilitation and supported employment services, money management assistance for accessing other health care and obtaining federal income and housing support, accessing veterans’ services, stipends, and other incentives to attract and retain sufficient numbers of qualified professionals as necessary to provide the necessary levels of these services. These grants shall, however, pay for only that portion of the costs of those services not otherwise provided by federal funds or other state funds.

(3) Methods used by counties to contract for services pursuant to paragraph (2) shall promote prompt and flexible use of funds, consistent with the scope of services for which the county has contracted with each provider.

(g) Contracts awarded pursuant to this part shall be exempt from the Public Contract Code and the state administrative manual and shall not be subject to the approval of the Department of General Services.

(h) Notwithstanding any other provision of law, funds awarded to counties pursuant to this part and Part 4 (commencing with Section 5850) shall not require a local match in funds.

(i) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 32.

Section 5814 is added to the Welfare and Institutions Code, to read:

5814.
(a) (1) This part shall be implemented only to the extent that funds are appropriated for purposes of this part. To the extent that funds are made available, the first priority shall go to maintain funding for the existing programs that meet adult system of care contract goals. The next priority for funding shall be given to counties with a high incidence of persons with serious mental illness and homeless, or at risk of homelessness, and meet the criteria developed pursuant to paragraphs (3) and (4).
(2) The Director of Health Care Services shall establish a methodology for awarding grants under this part consistent with the legislative intent expressed in Section 5802 and in consultation with the advisory committee established in this subdivision.
(3) (A) (i) The Director of Health Care Services shall establish an advisory committee for the purpose of providing advice regarding the development of criteria for the award of grants and the identification of specific performance measures for evaluating the effectiveness of grants.
(ii) The committee shall review evaluation reports and make findings on evidence-based best practices and recommendations for grant conditions.
(iii) At not less than one meeting annually, the advisory committee shall provide to the director written comments on the performance of each of the county programs.
(iv) Upon request by the department, each participating county that is the subject of a comment shall provide a written response to the comment. The department shall comment on each of these responses at a subsequent meeting.
(B) The committee shall include, but not be limited to, representatives from each of the following:
(i) State, county, and community veterans’ services and disabled veterans outreach programs.
(ii) Supportive housing and other housing assistance programs.
(iii) Law enforcement.
(iv) County behavioral health and private providers of local mental health and substance use disorder treatment services and mental health and substance use disorder outreach services.
(v) The Department of Corrections and Rehabilitation.
(vi) Local substance abuse services providers.
(vii) The Department of Rehabilitation.
(viii) Providers of local employment services.
(ix) The State Department of Social Services.
(x) The Department of Housing and Community Development.
(xi) A service provider to transition youth.
(xii) The United Advocates for Children of California.
(xiii) The California Mental Health Advocates for Children and Youth.
(xiv) The Mental Health Association of California.
(xv) The California Alliance for the Mentally Ill.
(xvi) The California Network of Mental Health Clients.
(xvii) The California Behavioral Health Planning Council.
(xviii) The Behavioral Health Services Oversight and Accountability Commission.
(xix) Other appropriate entities.
(4) The criteria for the award of grants shall include, but not be limited to, all of the following:
(A) A description of a comprehensive strategic plan for providing outreach, prevention, intervention, and evaluation in a cost-appropriate manner corresponding to the criteria specified in subdivision (c).
(B) A description of the local population to be served, the ability to administer an effective service program, and the degree to which local agencies and advocates will support and collaborate with program efforts.
(C) A description of efforts to maximize the use of other state, federal, and local funds or services that can support and enhance the effectiveness of these programs.
(5) (A) To reduce the cost of providing supportive housing for clients, counties that receive a grant pursuant to this part after January 1, 2004, shall enter into contracts with sponsors of supportive housing projects to the greatest extent possible.
(B) Participating counties are encouraged to commit a portion of their grants to rental assistance for a specified number of housing units in exchange for the counties’ clients having the right of first refusal to rent the assisted units.
(b) (1) (A) In each year that additional funding is provided by the annual Budget Act, the State Department of Health Care Services shall establish programs that offer individual counties sufficient funds to comprehensively serve severely mentally ill adults who are homeless, recently released from a county jail or the state prison, or others who are untreated, unstable, and at significant risk of incarceration or homelessness unless treatment is provided to them.
(B) For purposes of this subdivision, “seriously mentally ill” adults are those individuals described in subdivision (b) of Section 5600.3.
(2) In consultation with the advisory committee established pursuant to paragraph (3) of subdivision (a), the department shall report to the Legislature on or before May 1 of each year that additional funding is provided and shall evaluate, at a minimum, the effectiveness of the strategies in providing successful outreach and reducing homelessness, involvement with local law enforcement, and other measures identified by the department.
(3) The evaluation shall include, for each program funded in the current fiscal year, as much of the following as available information permits:
(A) The number of persons served and, of those, the number who receive extensive community mental health and substance use disorder treatment services.
(B) The number of persons who are able to maintain housing, including the type of housing and whether it is emergency, transitional, or permanent housing as defined by the department.
(C) (i) The amount of grant funding spent on each type of housing.
(ii) Other local, state, or federal funds or programs used to house clients.
(D) The number of persons with contacts with local law enforcement and the extent to which local and state incarceration has been reduced or avoided.
(E) The number of persons participating in employment service programs, including competitive employment.
(F) The number of persons contacted in outreach efforts who appear to have a serious mental illness, as described in Section 5600.3, and who have refused treatment after completion of all applicable outreach measures.
(G) The amount of hospitalization that has been reduced or avoided.
(H) The extent to which veterans identified through these programs’ outreach are receiving federally funded veterans’ services for which they are eligible.
(I) The extent to which programs funded for three or more years are making a measurable and significant difference on the street, in hospitals, and in jails as compared to other counties or as compared to those counties in previous years.
(J) For those who have been enrolled in this program for at least two years and who were enrolled in Medi-Cal prior to, and at the time they were enrolled in, this program, a comparison of their Medi-Cal hospitalizations and other Medi-Cal costs for the two years prior to enrollment and the two years after enrollment in this program.
(K) The number of persons served who were and were not receiving Medi-Cal benefits in the 12-month period prior to enrollment and, to the extent possible, the number of emergency room visits and other medical costs for those not enrolled in Medi-Cal in the prior 12-month period.
(c) To the extent that state savings associated with providing integrated services for the mentally ill are quantified, it is the intent of the Legislature to capture those savings in order to provide integrated services to additional adults.
(d) Each project shall include outreach and service grants in accordance with a contract between the state and approved counties that reflects the number of anticipated contacts with people who are homeless or at risk of homelessness and the number of those who are seriously mentally ill and who are likely to be successfully referred for treatment and will remain in treatment, as necessary.
(e) All counties that receive funding shall be subject to specific terms and conditions of oversight and training, which shall be developed by the department in consultation with the advisory committee.
(f) (1) As used in this part, “receiving extensive mental health and substance use disorder treatment services” means having a personal services coordinator, as described in subdivision (b) of Section 5806, and having an individual personal service plan as described in subdivision (c) of Section 5806.
(2) The funding provided pursuant to this part shall be sufficient to provide mental health and substance use disorder treatment services, medically necessary medications to treat serious mental illnesses, alcohol and drug services, transportation, supportive housing, and other housing assistance, vocational rehabilitation and supported employment services, money management assistance for accessing other health care and obtaining federal income and housing support, accessing veterans’ services, stipends, and other incentives to attract and retain sufficient numbers of qualified professionals as necessary to provide the necessary levels of these services. These grants shall, however, pay for only that portion of the costs of those services not otherwise provided by federal funds or other state funds.
(3) Methods used by counties to contract for services pursuant to paragraph (2) shall promote prompt and flexible use of funds consistent with the scope of services for which the county has contracted with each provider.
(g) Contracts awarded pursuant to this part shall be exempt from the Public Contract Code and the state administrative manual and shall not be subject to the approval of the Department of General Services.
(h) Notwithstanding any other provision of law, funds awarded to counties pursuant to this part and Part 4 (commencing with Section 5850) do not require a local match in funds.
(i) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 33.

Section 5830 of the Welfare and Institutions Code is amended to read:

5830.

County mental health programs shall develop plans for innovative programs to be funded pursuant to paragraph (6) of subdivision (a) of Section 5892.

(a) The innovative programs shall have the following purposes:

(1) To increase access to underserved groups.

(2) To increase the quality of services, including better outcomes.

(3) To promote interagency collaboration.

(4) To increase access to services, including, but not limited to, services provided through permanent supportive housing.

(b) All projects included in the innovative program portion of the county plan shall meet the following requirements:

(1) Address one of the following purposes as its primary purpose:

(A) Increase access to underserved groups, which may include providing access through the provision of permanent supportive housing.

(B) Increase the quality of services, including measurable outcomes.

(D) Increase access to services, which may include providing access through the provision of permanent supportive housing.

(2) Support innovative approaches by doing one of the following:

(A) Introducing new mental health practices or approaches, including, but not limited to, prevention and early intervention.

(B) Making a change to an existing mental health practice or approach, including, but not limited to, adaptation for a new setting or community.

(C) Introducing a new application to the mental health system of a promising community-driven practice or an approach that has been successful in nonmental health contexts or settings.

(D) Participating in a housing program designed to stabilize a person’s living situation while also providing supportive services on site.

(c) An innovative project may affect virtually any aspect of mental health practices or assess a new or changed application of a promising approach to solving persistent, seemingly intractable mental health challenges, including, but not limited to, any of the following:

(1) Administrative, governance, and organizational practices, processes, or procedures.

(2) Advocacy.

(3) Education and training for service providers, including nontraditional mental health practitioners.

(4) Outreach, capacity building, and community development.

(5) System development.

(6) Public education efforts.

(7) Research. If research is chosen for an innovative project, the county mental health program shall consider, but is not required to implement, research of the brain and its physical and biochemical processes that may have broad applications, but that have specific potential for understanding, treating, and managing mental illness, including, but not limited to, research through the Cal-BRAIN program pursuant to Section 92986 of the Education Code or other collaborative, public-private initiatives designed to map the dynamics of neuron activity.

(8) Services and interventions, including prevention, early intervention, and treatment.

(9) Permanent supportive housing development.

(d) If an innovative project has proven to be successful and a county chooses to continue it, the project workplan shall transition to another category of funding as appropriate.

(e) County mental health programs shall expend funds for their innovation programs upon approval by the Mental Health Services Oversight and Accountability Commission.

(f) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 34.

Section 5830 is added to the Welfare and Institutions Code, to read:

5830.
(a) (1) The State Department of Health Care Services shall establish a program, to be administered locally by counties utilizing funds pursuant to paragraph (1) of subdivision (a) of Section 5892, to provide housing interventions for persons who are chronically homeless or experiencing homelessness or are at risk of homelessness, as defined in Section 5892, and meet one of the following conditions:
(A) Children or youth with a serious emotional disturbance, as defined in Section 5600.3.
(B) Adults and older individuals with a serious mental illness, as defined in Section 5600.3.
(C) Persons with a substance use disorder, as defined in Section 5891.5.
(2) Housing interventions shall not be limited to individuals enrolled in full-service partnerships pursuant to Section 5892.
(b) (1) County programs for housing interventions may include any of the following:
(A) Rental subsidies.
(B) Operating subsidies.
(C) Shared housing.
(D) Family housing for children and youth who meet the criteria specified in subdivision (a).
(E) The nonfederal share for transitional rent.
(F) Other housing supports, as defined by the State Department of Health Care Services.
(2) (A) County programs for housing interventions may include capital development projects, under the provisions of Section 5831, to either construct or rehabilitate housing units, or both, for the persons meeting the criteria specified in subdivision (a) when authorized by the State Department of Health Care Services for this purpose, which will be no sooner than for the fiscal year 2032–2035 integrated plan.
(B) The units funded under this provision shall be available for use in the fiscal year in which the allocation is made and shall meet a cost-per-unit threshold as specified by the State Department of Health Care Services.
(3) County programs for housing interventions shall comply with all requirements specified by the State Department of Health Care Services, pursuant to Section 5963.05, for the purposes of administering paragraphs (1) and (2).
(c) (1) To the extent that necessary federal approvals have been obtained for the Medi-Cal program to cover housing interventions and federal financial participation is available and not otherwise jeopardized, the housing interventions funds distributed pursuant to subdivision (a) of Section 5892 may be used for the nonfederal share of Medi-Cal covered housing related services and shall only cover the costs that cannot be paid for with Medi-Cal program funds.
(2) Funds cannot be used for housing interventions covered by a Medi-Cal managed care plan, as defined in subdivision (j) of Section 14184.101.
(d) (1) Notwithstanding any other law, a capital development project funded pursuant to former paragraph (2) of subdivision (a) of Section 5892 shall be deemed consistent and in conformity with any applicable local plan, standard, or requirement and allowed as a permitted use within the zone in which the structure is located and shall not be subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals.
(2) Notwithstanding any other law, the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code) shall not apply to a capital development project funded pursuant to paragraph (1) of subdivision (a) of Section 5892 if all of the following requirements are satisfied:
(A) No housing units were acquired by eminent domain.
(B) The housing units will be in decent, safe, and sanitary condition at the time of their occupancy.
(C) Notwithstanding paragraph (1) of subdivision (a) of Section 1720 of the Labor Code, construction of the project constitutes a public works project for purposes of Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code.
(D) The county obtains an enforceable commitment that all contractors and subcontractors performing work on the project will use a skilled and trained workforce for a proposed rehabilitation, construction, or major alteration in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code.
(E) An acquisition or rehabilitation of housing units is paid for, in whole or part, with public funds.
(F) The project provides housing for individuals who meet the criteria specified in subdivision (a) and their families.
(G) Long-term covenants and restrictions require the housing units to be restricted to persons who meet the criteria specified in subdivision (a) for no fewer than 30 years.
(H) The capital development project does not result in an increase in the existing onsite development footprint of structure, structures, or improvements.
(3) If determined that a capital development project is not subject to the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code) pursuant to this section, the county shall file a notice of exemption with the Office of Planning and Research and the county clerk of the county in which the project is located in the manner specified in subdivisions (b) and (c) of Section 21152 of the Public Resources Code.
(4) Notwithstanding any other law, this section shall comply with Section 5831.
(e) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 35.

Section 5831 is added to the Welfare and Institutions Code, to read:

5831.
The term “low rent housing project,” as defined in Section 1 of Article XXXIV of the California Constitution, does not apply to a development comprised of urban or rural dwellings, apartments, or other living accommodations that meets any of the following criteria:
(a) The development meets both of the following criteria:
(1) It is privately owned housing, receiving no ad valorem property tax exemption other than exemptions granted pursuant to subdivision (f) or (g) of Section 214 of the Revenue and Taxation Code, not fully reimbursed to all taxing entities.
(2) Not more than 49 percent of the dwellings, apartments, or other living accommodations of the development are occupied by persons of low income.
(b) The development is privately owned housing, is not exempt from ad valorem taxation by reason of public ownership, and is not financed with direct long-term financing from a public body.
(c) The development is intended for owner-occupancy, which may include a limited-equity housing cooperative, as defined in Section 50076.5 of the Health and Safety Code, cooperative, or condominium ownership rather than for rental-occupancy.
(d) The development consists of newly constructed, privately owned, one-to-four family dwellings not located on adjoining sites.
(e) The development consists of existing dwelling units leased by the state public body from the private owner of these dwelling units.
(f) The development consists of the rehabilitation, reconstruction, improvement or addition to, or replacement of, dwelling units of a previously existing low-rent housing project or a project previously or currently occupied by lower income households, as defined in Section 50079.5 of the Health and Safety Code.
(g) The development consists of the acquisition, rehabilitation, reconstruction, or improvement, or a combination thereof, of a rental housing development that, prior to the date of the transaction to acquire, rehabilitate, reconstruct, or improve, or a combination thereof, was subject to a contract for federal or state public body assistance for the purpose of providing affordable housing for low-income households and maintains, or enters into, a contract for federal or state public body assistance for the purpose of providing affordable housing for low-income households.
(h) The development consists of the acquisition, rehabilitation, reconstruction, alterations work, or new construction, or a combination thereof, of lodging facilities or dwelling units using moneys received from the Behavioral Health Services Fund established pursuant to subdivision (a) of Section 5890.
(i) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 36.

Section 5835 of the Welfare and Institutions Code is amended to read:

5835.

(a) This part shall be known, and may be cited, as the Early Psychosis Intervention Plus (EPI Plus) Program to encompass early psychosis and mood disorder detection and intervention.

(b) As used in this part, the following definitions shall apply:

(1) “Commission” means the Mental Health Services Oversight and Accountability Commission established pursuant to Section 5845.

(2) “Early psychosis and mood disorder detection and intervention” refers to a program that utilizes evidence-based approaches and services to identify and support clinical and functional recovery of individuals by reducing the severity of first, or early, episode psychotic symptoms, other early markers of serious mental illness, such as mood disorders, keeping individuals in school or at work, and putting them on a path to better health and wellness. This may include, but is not limited to, all of the following:

(A) Focused outreach to at-risk and in-need populations as applicable.

(B) Recovery-oriented psychotherapy, including cognitive behavioral therapy focusing on cooccurring disorders.

(D) Supported education and employment.

(E) Pharmacotherapy and primary care coordination.

(F) Use of innovative technology for mental health information feedback access that can provide a valued and unique opportunity to assist individuals with mental health needs and to optimize care.

(G) Case management.

(3) “County” includes a city receiving funds pursuant to Section 5701.5.

(c) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 37.

Section 5835 is added to the Welfare and Institutions Code, to read:

5835.
(a) This part shall be known, and may be cited, as the Early Psychosis Intervention (EPI) Plus Program to encompass early psychosis and mood disorder detection and intervention.
(b) As used in this part, the following definitions shall apply:
(1) “Commission” means the Behavioral Health Services Oversight and Accountability Commission established pursuant to Section 5845.
(2) “Early psychosis and mood disorder detection and intervention” refers to a program that utilizes evidence-based approaches and services to identify and support clinical and functional recovery of individuals by reducing the severity of first, or early, episode psychotic symptoms, other early markers of serious mental illness, such as mood disorders, keeping individuals in school or at work, and putting them on a path to better health and wellness. This may include, but is not limited to, all of the following:
(A) Focused outreach to at-risk and in-need populations as applicable.
(B) Recovery-oriented psychotherapy, including cognitive behavioral therapy focusing on cooccurring disorders.
(C) Family psychoeducation and support.
(D) Supported education and employment.
(E) Pharmacotherapy and primary care coordination.
(F) Use of innovative technology for mental health information feedback access that can provide a valued and unique opportunity to assist individuals with mental health needs and to optimize care.
(G) Case management.
(3) “County” includes a city receiving funds pursuant to Section 5701.5.
(c) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 38.

Section 5835.2 of the Welfare and Institutions Code is amended to read:

5835.2.

(a) There is hereby established an advisory committee to the commission. The Mental Health Services Oversight and Accountability Commission shall accept nominations and applications to the committee, and the chair of the Mental Health Services Oversight and Accountability Commission shall appoint members to the committee, unless otherwise specified. Membership on the committee shall be as follows:

(1) The chair of the Mental Health Services Oversight and Accountability Commission, or ~~his or her~~ their designee, who shall serve as the chair of the committee.

(2) The president of the County Behavioral Health Directors Association of California, or ~~his or her~~ their designee.

(3) The director of a county behavioral health department that administers an early psychosis and mood disorder detection and intervention-type program in ~~his or her~~ their county.

(4) A representative from a nonprofit community mental health organization that focuses on service delivery to transition-aged youth and young adults.

(5) A psychiatrist or psychologist.

(6) A representative from the Behavioral Health Center of Excellence at the University of California, Davis, or a representative from a similar entity with expertise from within the University of California system.

(7) A representative from a health plan participating in the Medi-Cal managed care program and the employer-based health care market.

(8) A representative from the medical technologies industry who is knowledgeable in advances in technology related to the use of innovative social media and mental health information feedback access.

(9) A representative knowledgeable in evidence-based practices as they pertain to the operations of an early psychosis and mood disorder detection and intervention-type program, including knowledge of other states’ experiences.

(10) A representative who is a parent or guardian caring for a young child with a mental illness.

(11) An at-large representative identified by the chair.

(12) A representative who is a person with lived experience of a mental illness.

(13) A primary care provider from a licensed primary care clinic that provides integrated primary and behavioral health care.

(b) The advisory committee shall be convened by the chair and shall, at a minimum, do all of the following:

(1) Provide advice and guidance broadly on approaches to early psychosis and mood disorder detection and intervention programs from an evidence-based perspective.

(2) Review and make recommendations on the commission’s guidelines or any regulations in the development, design, selection of awards pursuant to this part, and the implementation or oversight of the early psychosis and mood disorder detection and intervention competitive selection process established pursuant to this part.

(3) Assist and advise the commission in the overall evaluation of the early psychosis and mood disorder detection and intervention competitive selection process.

(4) Provide advice and guidance as requested and directed by the chair.

(5) Recommend a core set of standardized clinical and outcome measures that the funded programs would be required to collect, subject to future revision. A free data sharing portal shall be available to all participating programs.

(6) Inform the funded programs about the potential to participate in clinical research studies.

SEC. 39.

Section 5835.2 is added to the Welfare and Institutions Code, to read:

5835.2.
(a) There is hereby established an advisory committee to the commission. The Behavioral Health Services Oversight and Accountability Commission shall accept nominations and applications to the committee, and the chair of the Behavioral Health Services Oversight and Accountability Commission shall appoint members to the committee, unless otherwise specified. Membership on the committee shall be as follows:
(1) The chair of the Behavioral Health Services Oversight and Accountability Commission, or their designee, who shall serve as the chair of the committee.
(2) The president of the County Behavioral Health Directors Association of California, or their designee.
(3) The director of a county behavioral health department that administers an early psychosis and mood disorder detection and intervention-type program in their county.
(4) A representative from a nonprofit community mental health organization that focuses on service delivery to transition-aged youth and young adults.
(5) A psychiatrist or psychologist.
(6) A representative from the Behavioral Health Center of Excellence at the University of California, Davis, or a representative from a similar entity with expertise from within the University of California system.
(7) A representative from a health plan participating in the Medi-Cal managed care program and the employer-based health care market.
(8) A representative from the medical technologies industry who is knowledgeable in advances in technology related to the use of innovative social media and mental health information feedback access.
(9) A representative knowledgeable in evidence-based practices as they pertain to the operations of an early psychosis and mood disorder detection and intervention-type program, including knowledge of other states’ experiences.
(10) A representative who is a parent or guardian caring for a young child with a mental illness.
(11) An at-large representative identified by the chair.
(12) A representative who is a person with lived experience of a mental illness.
(13) A primary care provider from a licensed primary care clinic that provides integrated primary and behavioral health care.
(b) The advisory committee shall be convened by the chair and shall, at a minimum, do all of the following:
(1) Provide advice and guidance broadly on approaches to early psychosis and mood disorder detection and intervention programs from an evidence-based perspective.
(2) Review and make recommendations on the commission’s guidelines or regulations in the development, design, and selection of awards pursuant to this part, and the implementation or oversight of the early psychosis and mood disorder detection and intervention competitive selection process established pursuant to this part.
(3) Assist and advise the commission in the overall evaluation of the early psychosis and mood disorder detection and intervention competitive selection process.
(4) Provide advice and guidance as requested and directed by the chair.
(5) Recommend a core set of standardized clinical and outcome measures that the funded programs would be required to collect, subject to future revision. A free data sharing portal shall be available to all participating programs.
(6) Inform the funded programs about the potential to participate in clinical research studies.
(c) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 40.

Section 5840 of the Welfare and Institutions Code is amended to read:

5840.

(a) The State Department of Health Care Services, in coordination with counties, shall establish a program designed to prevent mental illnesses from becoming severe and disabling. The program shall emphasize improving timely access to services for underserved populations.

(b) The program shall include the following components:

(1) Outreach to families, employers, primary care health care providers, and others to recognize the early signs of potentially severe and disabling mental illnesses.

(2) Access and linkage to medically necessary care provided by county mental health programs for children with ~~severe~~ serious mental illness, as defined in Section 5600.3, and for adults and seniors with severe mental illness, as defined in Section 5600.3, as early in the onset of these conditions as practicable.

(3) Reduction in stigma associated with either being diagnosed with a mental illness or seeking mental health services.

(4) Reduction in discrimination against people with mental illness.

(c) The program shall include mental health services similar to those provided under other programs that are effective in preventing mental illnesses from becoming severe, and shall also include components similar to programs that have been successful in reducing the duration of untreated severe mental illnesses and assisting people in quickly regaining productive lives.

(d) The program shall emphasize strategies to reduce the following negative outcomes that may result from untreated mental illness:

(1) Suicide.

(2) Incarcerations.

(3) School failure or dropout.

(4) Unemployment.

(5) Prolonged suffering.

(6) Homelessness.

(7) Removal of children from their homes.

(e) Prevention and early intervention funds may be used to broaden the provision of community-based mental health services by adding prevention and early intervention services or activities to these services, including prevention and early intervention strategies that address mental health needs, substance misuse or substance use disorders, or needs relating to cooccurring mental health and substance use services.

(f)In consultation with mental health stakeholders, and consistent with regulations from the Mental Health Services Oversight and Accountability Commission, pursuant to Section 5846, the department shall revise the program elements in Section 5840 applicable to all county mental health programs in future years to reflect what is learned about the most effective prevention and intervention programs for children, adults, and seniors.
(f) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 41.

Section 5840 is added to the Welfare and Institutions Code, to read:

5840.
(a) (1) The State Department of Health Care Services, in coordination with counties, shall establish an early intervention program designed to prevent mental illnesses and substance use disorders from becoming severe and disabling.
(2) Early intervention programs shall be funded pursuant to clause (ii) of subparagraph (A) of paragraph (5) of subdivision (a) of Section 5892.
(b) The program shall include the following components:
(1) Outreach to families, employers, primary care health care providers, behavioral health urgent care, hospitals, inclusive of emergency departments, and others to recognize the early signs of potentially severe and disabling mental health illnesses and substance use disorders.
(2) Access and linkage to medically necessary care provided by county behavioral health programs for children and youth who have a serious emotional disturbance, as defined in Section 5600.3, for adults and older adults with a serious mental illness, as defined in Section 5600.3, and for individuals with a substance use disorder, as early in the onset of these conditions as practicable. This includes the scaling of and referral to the Early Psychosis Intervention (EPI) Plus Program or other similar evidence based early psychosis and mood disorder detection and intervention programs.
(3) (A) Mental health and substance use disorder treatment services, similar to those provided under other programs that are effective in preventing mental health illnesses and substance use disorders from becoming severe, and components similar to programs that have been successful in reducing the duration of untreated serious mental health illnesses and substance use disorders and assisting people in quickly regaining productive lives.
(B) Mental health treatment services may include services to address first episode psychosis.
(4) (A) The State Department of Health Care Services shall establish a biennial list of evidence-based practices.
(B) Evidence-based practices may focus on addressing the needs of those who decompensate into severe behavioral health conditions.
(C) Counties shall utilize the list to determine which evidence-based practices to implement locally.
(D) The State Department of Health Care Services may require a county to implement specific evidence-based practices.
(5) Additional components developed by the State Department of Health Care Services.
(c) The early intervention program shall emphasize the reduction of the likelihood of:
(1) Suicide.
(2) Incarcerations.
(3) School failure or dropout.
(4) Unemployment.
(5) Prolonged suffering.
(6) Homelessness.
(7) Removal of children from their homes.
(8) Overdose.
(d) For purposes of this section, “substance use disorder” shall have the meaning as defined in subdivision (c) of Section 5891.5.
(e) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 42.

Section 5840.5 of the Welfare and Institutions Code is repealed.

5840.5.
~~It is the intent of the Legislature that this chapter achieve all of the following:~~
~~(a)Expand the provision of high quality Mental Health Services Act (MHSA) Prevention and Early Intervention (PEI) programs at the county level in California.~~
(b)Increase the number of PEI programs and systems, including those utilizing community-defined practices, that focus on reducing disparities for unserved, underserved, and inappropriately served racial, ethnic, and cultural communities.
(c)Reduce unnecessary hospitalizations, homelessness, suicides, and inpatient days by appropriately utilizing community-based services and improving timely access to prevention and early intervention services.
(d)Increase participation in community activities, school attendance, social interactions, physical and primary health care services, personal bonding relationships, and rehabilitation, including employment and daily living function development for clients.
~~(e)Increase collaboration and coordination among primary care, mental health, and aging service providers, and reduce hesitance to seek treatment and services due to mental health stigma.~~
~~(f)Create a more focused approach for PEI requirements.~~
~~(g)Increase programmatic and fiscal oversight of county MHSA-funded PEI programs.~~
~~(h)Encourage counties to coordinate and blend funding streams and initiatives to ensure services are integrated across systems.~~
~~(i)Encourage counties to leverage innovative technology platforms.~~
~~(j)Reflect the stated goals as outlined in the PEI component of the MHSA, as stated in Section 5840.~~

SEC. 43.

Section 5840.6 of the Welfare and Institutions Code is amended to read:

5840.6.

For purposes of this chapter, the following definitions shall apply:

(a) “Commission” means the Mental Health Services Oversight and Accountability Commission established pursuant to Section 5845.

(b) “County” also includes a city receiving funds pursuant to Section 5701.5.

(c) “Prevention and early intervention funds” means funds from the Mental Health Services Fund allocated for prevention and early intervention programs pursuant to paragraph (3) of subdivision (a) of Section 5892.

(d) “Childhood trauma prevention and early intervention” refers to a program that targets children exposed to, or who are at risk of exposure to, adverse and traumatic childhood events and prolonged toxic stress in order to deal with the early origins of mental health needs and prevent long-term mental health concerns. This may include, but is not limited to, all of the following:

(1) Focused outreach and early intervention to at-risk and in-need populations.

(2) Implementation of appropriate trauma and developmental screening and assessment tools with linkages to early intervention services to children that qualify for these services.

(3) Collaborative, strengths-based approaches that appreciate the resilience of trauma survivors and support their parents and caregivers when appropriate.

(4) Support from peer support specialists and community health workers trained to provide mental health services.

(5) Multigenerational family engagement, education, and support for navigation and service referrals across systems that aid the healthy development of children and families.

(6) Linkages to primary care health settings, including, but not limited to, federally qualified health centers, rural health centers, community-based providers, school-based health centers, and school-based programs.

(7) Leveraging the healing value of traditional cultural connections, including policies, protocols, and processes that are responsive to the racial, ethnic, and cultural needs of individuals served and recognition of historical trauma.

(8) Coordinated and blended funding streams to ensure individuals and families experiencing toxic stress have comprehensive and integrated supports across systems.

(e) “Early psychosis and mood disorder detection and intervention” has the same meaning as set forth in paragraph (2) of subdivision (b) of Section 5835 and may include programming across the age span.

(f) “Youth outreach and engagement” means strategies that target secondary school and transition age youth, with a priority on partnerships with college mental health programs that educate and engage students and provide either on-campus, off-campus, or linkages to mental health services not provided through the campus to students who are attending colleges and universities, including, but not limited to, public community colleges. Outreach and engagement may include, but is not limited to, all of the following:

(1) Meeting the mental health needs of students that cannot be met through existing education funds.

(2) Establishing direct linkages for students to community-based mental health services.

(3) Addressing direct services, including, but not limited to, increasing college mental health staff-to-student ratios and decreasing wait times.

(4) Participating in evidence-based and community-defined best practice programs for mental health services.

(5) Serving underserved and vulnerable populations, including, but not limited to, lesbian, gay, bisexual, transgender, and queer persons, victims of domestic violence and sexual abuse, and veterans.

(6) Establishing direct linkages for students to community-based mental health services for which reimbursement is available through the students’ health coverage.

(7) Reducing racial disparities in access to mental health services.

(8) Funding mental health stigma reduction training and activities.

(9) Providing college employees and students with education and training in early identification, intervention, and referral of students with mental health needs.

(10) Interventions for youth with signs of behavioral or emotional problems who are at risk of, or have had any, contact with the juvenile justice system.

(11) Integrated youth mental health programming.

(12) Suicide prevention programming.

(g) “Culturally competent and linguistically appropriate prevention and intervention” refers to a program that creates critical linkages with community-based organizations, including, but not limited to, clinics licensed or operated under subdivision (a) of Section 1204 of the Health and Safety Code, or clinics exempt from clinic licensure pursuant to subdivision (c) of Section 1206 of the Health and Safety Code.

(1) “Culturally competent and linguistically appropriate” means the ability to reach underserved cultural populations and address specific barriers related to racial, ethnic, cultural, language, gender, age, economic, or other disparities in mental health services access, quality, and outcomes.

(2) “Underserved cultural populations” means those who are unlikely to seek help from any traditional mental health service because of stigma, lack of knowledge, or other barriers, including members of ethnically and racially diverse communities, members of the gay, lesbian, bisexual, and transgender communities, and veterans, across their lifespans.

(h) “Strategies targeting the mental health needs of older adults” means, but is not limited to, all of the following:

(1) Outreach and engagement strategies that target caregivers, victims of elder abuse, and individuals who live alone.

(2) Suicide prevention programming.

(3) Outreach to older adults who are isolated.

(4) Early identification programming of mental health symptoms and disorders, including, but not limited to, anxiety, depression, and psychosis.

(i) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 44.

Section 5840.6 is added to the Welfare and Institutions Code, to read:

5840.6.
For purposes of this chapter, the following definitions shall apply:
(a) “County” includes a city receiving funds pursuant to Section 5701.5.
(b) “Early intervention funds” means funds from the Behavioral Health Services Fund allocated for early intervention services and programs pursuant to clause (ii) of subparagraph (A) of paragraph (5) of subdivision (a) of Section 5892.
(c) “Childhood trauma early intervention” refers to a program that targets children exposed to, or who are at risk of exposure to, adverse and traumatic childhood events and prolonged toxic stress in order to deal with the early origins of mental health and substance use disorder needs and prevent long-term mental health and substance use disorder concerns. This may include, but is not limited to, all of the following:
(1) Focused outreach and early intervention to at-risk and in-need populations, including youth experiencing homelessness, justice-involved youth, and child welfare-involved youth.
(2) Implementation of appropriate trauma and developmental screening and assessment tools with linkages to early intervention services to children who qualify for these services.
(3) Collaborative, strengths-based approaches that appreciate the resilience of trauma survivors and support their parents and caregivers when appropriate.
(4) Support from peer support specialists, wellness coaches, and community health workers trained to provide mental health and substance use disorder treatment services with an emphasis on culturally and linguistically tailored approaches.
(5) Multigenerational family engagement, education, and support for navigation and service referrals across systems that aid the healthy development of children and families.
(6) Collaboration with county child welfare agencies and other system partners, including Medi-Cal managed care plans, as defined in subdivision (j) of Section 14184.101, to address the physical, mental health, substance use and health-related social needs of child-welfare-involved youth.
(7) Linkages to primary care health settings, including, but not limited to, federally qualified health centers, rural health centers, community-based providers, school-based health centers, school-linked providers, and school-based programs.
(8) Leveraging the healing value of traditional cultural connections and faith-based organizations, including policies, protocols, and processes that are responsive to the racial, ethnic, and cultural needs of individuals served and recognition of historical trauma.
(9) Blended funding streams to provide individuals and families experiencing toxic stress comprehensive and integrated supports across systems.
(d) “Early psychosis and mood disorder detection and intervention” has the same meaning as set forth in paragraph (2) of subdivision (b) of Section 5835 and may include programming across the age span.
(e) “Youth outreach and engagement” means strategies that target secondary schoolage and transition-age youth including, but not limited to, all of the following:
(1) Establishing direct linkages for youth to community-based mental health and substance use disorder treatment services.
(2) Participating in evidence-based practices and community-defined evidence programs for mental health and substance use disorder treatment services.
(3) Providing supports to facilitate access to services and programs for underserved and vulnerable populations, including, but not limited to, members of ethnically and racially diverse communities, members of the LGBTQ+ communities, victims of domestic violence and sexual abuse, and veterans.
(4) Establishing direct linkages for students to community-based mental health and substance use disorder treatment services for which reimbursement is available through the students’ health coverage.
(5) Reducing racial disparities in access to mental health and substance use disorder treatment services.
(6) Providing school employees and students with education and training in early identification, intervention, and referral of students with mental health and substance use disorder needs.
(7) Strategies and programs for youth with signs of behavioral or emotional problems or substance misuse who are at risk of, or have had, contact with the juvenile justice system.
(8) Integrated youth mental health and substance use disorder programming.
(f) “Culturally competent and linguistically appropriate prevention and intervention” refers to a program that creates critical linkages with community-based organizations, including, but not limited to, clinics licensed or operated under subdivision (a) of Section 1204 of the Health and Safety Code and clinics exempt from clinic licensure pursuant to subdivision (c) of Section 1206 of the Health and Safety Code. The community-based organizations include facilities and providers licensed or certified by the State Department of Health Care Services, including, but not limited to, residential substance use disorder facilities licensed pursuant to Section 11834.01 of the Health and Safety Code or certified pursuant to Section 11830.1 of the Health and Safety Code and narcotic treatment programs licensed pursuant to Section 11839 of the Health and Safety Code.
(1) “Culturally competent and linguistically appropriate” means the ability to reach underserved cultural populations and address specific barriers related to racial, ethnic, cultural, language, gender, age, economic, or other disparities in mental health and substance use disorder treatment services access, quality, and outcomes.
(2) “Underserved cultural populations” means those who are unlikely to seek help from providers of traditional mental health and substance use disorder services because of stigma, lack of knowledge, or other barriers, including members of ethnically and racially diverse communities, members of the LGBTQ+ communities, victims of domestic violence and sexual abuse, and veterans, across their lifespans.
(g) “Strategies targeting the mental health and substance use disorder needs of older adults” means, but is not limited to, all of the following:
(1) Outreach and engagement strategies that target caregivers, victims of elder abuse, and individuals who live alone.
(2) Outreach to older adults who are isolated.
(3) Programs for early identification of mental health disorders and substance use disorders.
(h) This section shall become operative on July 1, 2026, if amendments to the Mental Health Service Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 45.

Section 5840.7 of the Welfare and Institutions Code is amended to read:

5840.7.

(a) On or before January 1, 2020, the commission shall establish priorities for the use of prevention and early intervention funds. These priorities shall include, but are not limited to, the following:

(1) Childhood trauma prevention and early intervention to deal with the early origins of mental health needs.

(2) Early psychosis and mood disorder detection and intervention, and mood disorder and suicide prevention programming that occurs across the lifespan.

(3) Youth outreach and engagement strategies that target secondary school and transition age youth, with a priority on partnership with college mental health programs.

(4) Culturally competent and linguistically appropriate prevention and intervention.

(5) Strategies targeting the mental health needs of older adults.

(6) Other programs the commission identifies, with stakeholder participation, that are proven effective in achieving, and are reflective of, the goals stated in Section 5840.

(b) On or before January 1, 2020, the commission shall develop a statewide strategy for monitoring implementation of this part, including enhancing public understanding of prevention and early intervention and creating metrics for assessing the effectiveness of how prevention and early intervention funds are used and the outcomes that are achieved. The commission shall analyze and monitor the established metrics using existing data, if available, and shall propose new data collection and reporting strategies, if necessary.

(c) The commission shall establish a strategy for technical assistance, support, and evaluation to support the successful implementation of the objectives, metrics, data collection, and reporting strategy.

(d) (1) The portion of funds in the county plan relating to prevention and early intervention shall focus on the established priorities, and shall be allocated, as determined by the county, with stakeholder input. A county may include other priorities, as determined through the stakeholder process, either in place of, or in addition to, the established priorities. If the county chooses to include other programs, the plan shall include a description of why those programs are included and metrics by which the effectiveness of those programs is to be measured.

(2) Counties may act jointly to meet the requirements of this section.

(e) If the commission requires additional resources for these purposes, it may prepare a proposal for consideration by the appropriate policy committees of the Legislature.

SEC. 46.

Section 5840.7 is added to the Welfare and Institutions Code, to read:

5840.7.
(a) The State Department of Health Care Services shall establish priorities for the use of early intervention funds. These priorities shall include, but are not limited to, the following:
(1) Childhood trauma early intervention to deal with the early origins of mental health and substance use disorder needs, including strategies focused on youth experiencing homelessness, justice-involved youth, child welfare-involved youth with a history of trauma, and other populations at risk of developing serious emotional disturbance or substance use disorders.
(2) Early psychosis and mood disorder detection and intervention and mood disorder programming that occurs across the lifespan.
(3) Youth outreach and engagement strategies that target secondary school and transition age youth with a priority on partnerships with college mental health and substance use disorder programs.
(4) Culturally competent and linguistically appropriate interventions.
(5) Strategies targeting the mental health and substance use disorder needs of older adults.
(6) Strategies to advance equity and reduce disparities.
(7) Programs that include community-defined evidence programs and evidence-based practices and mental health and substance use disorder treatment services similar to those provided under other programs that are effective in preventing mental illness and substance use disorders from becoming severe and components similar to programs that have been successful in reducing the duration of untreated severe mental illness and substance use disorders to assist people in quickly regaining productive lives.
(8) Other programs the State Department of Health Care Services identifies that are proven effective in achieving, and are reflective of, the goals stated in Section 5840.
(9) Strategies to address the needs of individuals at high risk of crisis.
(b) (1) (A) The portion of funds in the county plan relating to early intervention shall focus on the established priorities and shall be allocated as determined by the county with stakeholder input.
(B) (i) A county may include other priorities, as determined through the stakeholder process, either in place of or in addition to the established priorities.
(ii) If a county chooses to include other programs, the plan shall include a description of why those programs are included and metrics by which the effectiveness of those programs is to be measured.
(2) Counties may act jointly to meet the requirements of this section.
(c) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 47.

Section 5840.8 of the Welfare and Institutions Code is amended to read:

5840.8.

(a) Notwithstanding the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code), the commission may implement this chapter without taking regulatory action until regulations are adopted. The commission may use information notices or related communications to implement this chapter.

(b) This section shall be repealed on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 48.

Chapter 3 (commencing with Section 5840.10) is added to Part 3.6 of Division 5 of the Welfare and Institutions Code, to read:

CHAPTER 3. Population-based Prevention.
5840.10.
(a) Population-based prevention programs are activities designed to reduce the prevalence of mental health and substance use disorders and resulting conditions.
(b) Population-based prevention programs shall incorporate evidence-based practices or community-defined evidence practices and meet one or more of the following conditions:
(1) Target the entire population of the county to reduce the risk of individuals developing a mental health or substance use disorder.
(2) Target specific populations at elevated risk for a mental health or substance use disorder.
(3) Reduce stigma associated with seeking help for mental health challenges and substance use disorders.
(4) Target populations disproportionately impacted by systematic racism and discrimination.
(5) Prevent suicide or overdose.
(c) Population-based prevention programs may be implemented statewide or in community settings.
(d) Population-based prevention programs shall not include the provision of services and supports for individuals.
(e) In school-linked settings, population-based prevention supports and programs shall be provided on a schoolwide or classroom basis and not provide services and supports for individuals.
5840.11.
This chapter shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 49.

Section 5845 of the Welfare and Institutions Code is amended to read:

5845.

(a) The Mental Health Services Oversight and Accountability Commission is hereby established to oversee Part 3 (commencing with Section 5800), the Adult and Older Adult Mental Health System of Care Act; Part 3.1 (commencing with Section 5820), Human Resources, Education, and Training Programs; Part 3.2 (commencing with Section 5830), Innovative Programs; Part 3.6 (commencing with Section 5840), Prevention and Early Intervention Programs; and Part 4 (commencing with Section 5850), the Children’s Mental Health Services Act. The commission shall replace the advisory committee established pursuant to Section 5814. The commission shall consist of 16 voting members as follows:

(1) The Attorney General or the Attorney General’s designee.

(2) The Superintendent of Public Instruction or the Superintendent’s designee.

(3) The Chairperson of the Senate Committee on Health, the Chairperson of the Senate Committee on Human Services, or another member of the Senate selected by the President pro Tempore of the Senate.

(4) The Chairperson of the Assembly Committee on Health or another member of the Assembly selected by the Speaker of the Assembly.

(5) Two persons with a severe mental illness, a family member of an adult or senior with a severe mental illness, a family member of a child who has or has had a severe mental illness, a physician specializing in alcohol and drug treatment, a mental health professional, a county sheriff, a superintendent of a school district, a representative of a labor organization, a representative of an employer with less than 500 employees, a representative of an employer with more than 500 employees, and a representative of a health care service plan or insurer, all appointed by the Governor. In making appointments, the Governor shall seek individuals who have had personal or family experience with mental illness. At least one person appointed pursuant to this paragraph shall have a background in auditing.

(b) Members shall serve without compensation, but shall be reimbursed for all actual and necessary expenses incurred in the performance of their duties.

(c) The term of each member shall be three years, to be staggered so that approximately one-third of the appointments expire in each year.

(d) In carrying out its duties and responsibilities, the commission may do all of the following:

(1) Meet at least once each quarter at any time and location convenient to the public as it may deem appropriate. All meetings of the commission shall be open to the public.

(2) Within the limit of funds allocated for these purposes, pursuant to the laws and regulations governing state civil service, employ staff, including any clerical, legal, and technical assistance necessary. The commission shall administer its operations separate and apart from the State Department of Health Care Services and the California Health and Human Services Agency.

(3) Establish technical advisory committees, such as a committee of consumers and family members.

(4) Employ all other appropriate strategies necessary or convenient to enable it to fully and adequately perform its duties and exercise the powers expressly granted, notwithstanding any authority expressly granted to an officer or employee of state government.

(5) Enter into contracts.

(6) Obtain data and information from the State Department of Health Care Services, the Office of Statewide Health Planning and Development, or other state or local entities that receive Mental Health Services Act funds, for the commission to utilize in its oversight, review, training and technical assistance, accountability, and evaluation capacity regarding projects and programs supported with Mental Health Services Act funds.

(7) Participate in the joint state-county decisionmaking process, as contained in Section 4061, for training, technical assistance, and regulatory resources to meet the mission and goals of the state’s mental health system.

(8) Develop strategies to overcome stigma and discrimination, and accomplish all other objectives of Part 3.2 (commencing with Section 5830), Part 3.6 (commencing with Section 5840), and the other provisions of the Mental Health Services Act.

(9) At any time, advise the Governor or the Legislature regarding actions the state may take to improve care and services for people with mental illness.

(10) If the commission identifies a critical issue related to the performance of a county mental health program, it may refer the issue to the State Department of Health Care Services for consideration pursuant to the department’s authority in Section 5655.

(11) Assist in providing technical assistance to accomplish the purposes of the Mental Health Services Act, Part 3 (commencing with Section 5800), and Part 4 (commencing with Section 5850) in collaboration with the State Department of Health Care Services and in consultation with the County Behavioral Health Directors Association of California.

(12) Work in collaboration with the State Department of Health Care Services and the California Behavioral Health Planning Council, and in consultation with the County Behavioral Health Directors Association of California, in designing a comprehensive joint plan for a coordinated evaluation of client outcomes in the community-based mental health system, including, but not limited to, parts listed in subdivision (a). The California Health and Human Services Agency shall lead this comprehensive joint plan effort.

(13) Establish a framework and voluntary standard for mental health in the workplace that serves to reduce mental health stigma, increase public, employee, and employer awareness of the recovery goals of the Mental Health Services Act, and provide guidance to California’s employer community to put in place strategies and programs, as determined by the commission, to support the mental health and wellness of employees. The commission shall consult with the Labor and Workforce Development Agency or its designee to develop the standard.

(e) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 50.

Section 5845 is added to the Welfare and Institutions Code, to read:

5845.
(a) The Behavioral Health Services Oversight and Accountability Commission is hereby established to administer grants, identify key policy issues and emerging best practices, and promote high-quality programs implemented pursuant to Section 5892 through the examination of data and outcomes.
(b) (1) The commission shall replace the advisory committee established pursuant to Section 5814.
(2) The commission shall consist of 20 voting members as follows:
(A) The Attorney General or the Attorney General’s designee.
(B) The Superintendent of Public Instruction or the Superintendent’s designee.
(C) The Chairperson of the Senate Committee on Health, the Chairperson of the Senate Committee on Human Services, or another member of the Senate selected by the President pro Tempore of the Senate.
(D) The Chairperson of the Assembly Committee on Health or another Member of the Assembly selected by the Speaker of the Assembly.
(E) A county behavioral health director.
(F) (i) The following individuals, all appointed by the Governor:
(I) One person who has or who has had a serious mental illness.
(II) One person who has or who has had a substance use disorder.
(III) A family member of an adult or older adult with a serious mental illness.
(IV) A family member of an adult or older adult who has or has had a substance use disorder.
(V) A family member of a child or youth who has or has had a serious mental illness.
(VI) A family member of a child or youth who has or has had a substance use disorder.
(VII) A physician specializing in substance use disorder treatment, including the provision of medications for addiction treatment.
(VIII) A mental health professional.
(IX) A professional with expertise in housing and homelessness.
(X) A county sheriff.
(XI) A superintendent of a school district.
(XII) A representative of a labor organization.
(XIII) A representative of an employer with less than 500 employees.
(XIV) A representative of an employer with more than 500 employees.
(XV) A representative of a health care service plan or insurer.
(ii) In making appointments, the Governor shall seek individuals who have had personal or family experience with mental illness or substance use disorder.
(c) Members shall serve without compensation but shall be reimbursed for all actual and necessary expenses incurred in the performance of their duties.
(d) The term of each member shall be three years, to be staggered so that approximately one-third of the appointments expire in each year.
(e) (1) The commission shall have an Executive Director.
(2) The Executive Director will be responsible for management over the administrative, fiscal, and program performance of the commission.
(f) In carrying out its duties and responsibilities, the commission may do all of the following:
(1) (A) Meet at least once each quarter at a time and location convenient to the public as it may deem appropriate.
(B) All meetings of the commission shall be open to the public.
(2) Within the limit of funds allocated for these purposes, pursuant to the laws and regulations governing state civil service, employ staff, including clerical, legal, and technical assistance, as necessary.
(3) The commission shall administer its operations separate and apart from the State Department of Health Care Services and the California Health and Human Services Agency.
(4) Establish technical advisory committees, such as a committee of consumers and family members.
(5) Employ all other appropriate strategies necessary or convenient to enable it to fully and adequately perform its duties and exercise the powers expressly granted, notwithstanding authority expressly granted to an officer or employee of state government.
(6) Enter into contracts.
(7) At the discretion of the State Department of Health Care Services, the Department of Health Care Access and Information, or other state or local entities that receive Behavioral Health Services Act funds, the commission may obtain data and information for the commission to utilize in implementing paragraph (1) of subdivision (a) regarding projects and programs supported with Behavioral Health Services Act funds.
(8) Participate in the joint state-county decisionmaking process, as described in Section 4061, for training, technical assistance, and regulatory resources to meet the mission and goals of the state’s mental health system.
(9) Identify best practices to overcome stigma and discrimination and accomplish all other objectives of the Behavioral Health Services Act.
(10) At any time, advise the Governor or the Legislature regarding actions the state may take to improve care and services for people with mental illness or substance use disorder.
(11) If the commission identifies a critical issue related to the performance of a county mental health program, it may refer the issue to the State Department of Health Care Services pursuant to Section 5655.
(12) Assist in providing technical assistance to accomplish the purposes of the Behavioral Health Services Act in collaboration with the State Department of Health Care Services and in consultation with the County Behavioral Health Directors Association of California.
(13) (A) Work in collaboration with the State Department of Health Care Services and the California Behavioral Health Planning Council, and in consultation with the County Behavioral Health Directors Association of California, in designing a comprehensive joint plan for a coordinated evaluation of client outcomes in the community-based mental health and substance use disorder system, including, but not limited to, parts listed in subdivision (a).
(B) The California Health and Human Services Agency shall lead this comprehensive joint plan effort.
(14) Establish a framework and voluntary standard for mental health in the workplace that serves to reduce mental health stigma, increase public, employee, and employer awareness of the recovery goals of the Mental Health Services Act, and provide guidance to California’s employer community to put in place strategies and programs, as determined by the commission, to support the mental health and wellness of employees. The commission shall consult with the Labor and Workforce Development Agency or its designee to develop the standard.
(g) For purposes of this section, “substance use disorder” shall have the meaning as defined in subdivision (c) of Section 5891.5.
(h) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 51.

Section 5845.5 of the Welfare and Institutions Code is amended to read:

5845.5.

In addition to the activities authorized under Section 5845, the commission may establish a fellowship program in accordance with this section for the purpose of providing an experiential learning opportunity for a mental health consumer and a mental health professional.

(a) Participants in the fellowship shall serve on an annual basis and may serve only one term as a fellow.

(b) The fellowship program established under this section shall support the broad goals of the commission, including, but not limited to, subdivision (d) of Section 5846, and be based upon the following principles:

(1) To enhance opportunities for the work of the commission to reflect the perspective of persons with personal experience and state-of-the-art practices in the mental health field.

(2) To strengthen opportunities for the goals of the Mental Health Services Act, and the work of the commission in promoting those goals, to be accessible and understandable to mental health consumers, mental health professionals, and the general public.

(3) To improve opportunities for outreach and engagement with mental health consumers and mental health professionals relating to the work of the commission.

(4) To increase the awareness for mental health consumers and professionals of the goals of the Mental Health Services Act and the role of the state in meeting those goals; the role of public policy, regulation development, fiscal strategies, use of data, research, and evaluation; and communication strategies to improve mental health outcomes in California.

(c) The commission shall establish an advisory committee to provide guidance on the fellowship program goals, design, eligibility criteria, application process, and other issues as the commission deems necessary. The advisory committee shall include persons with personal experience with the mental health system, mental health professionals, persons with experience with similar fellowship programs, and others with diverse perspectives who can assist the commission to meet the goals of the fellowship program.

(d) The commission may enter into an interagency agreement or other contractual agreement with a state, local, or private entity, as determined by the commission, to receive technical assistance or relevant services to support the establishment and implementation of the fellowship program.

(e) The commission shall ensure that the fellowship program does not cause the displacement of any civil service employee. For purposes of this subdivision, “displacement” means a layoff, a demotion, an involuntary transfer to a new class, an involuntary transfer to a new location requiring a change of residence, a time base reduction, a change in shift or days off, or a reassignment to another position within the same class and general location.

(f) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 52.

Section 5845.5 is added to the Welfare and Institutions Code, to read:

5845.5.
In addition to the activities authorized under Section 5845, the commission may establish a fellowship program in accordance with this section for the purpose of providing an experiential learning opportunity for mental health or substance use disorder consumers and mental health or substance use disorder professionals.
(a) Participants in the fellowship shall serve on an annual basis and may serve only one term as a fellow.
(b) The fellowship program established under this section shall support the broad goals of the commission and be based upon the following principles:
(1) To enhance opportunities for the work of the commission to reflect the perspective of persons with personal experience and state-of-the-art practices in the mental health and substance use disorder fields.
(2) To strengthen opportunities for the goals of the Behavioral Health Services Act and the work of the commission in promoting those goals and to be accessible and understandable to mental health and substance use disorder individuals, mental health and substance use disorder professionals, and the general public.
(3) To improve opportunities for outreach and engagement with individuals who have a mental health disorder or a substance use disorder and mental health and substance use disorder professionals relating to the work of the commission.
(4) To increase the awareness of mental health and substance use disorder individuals and professionals of the goals of the Behavioral Health Services Act and both of the following:
(A) The role of the state in meeting those goals.
(B) The role of public policy, regulation development, fiscal strategies, use of data, research, and evaluation and communication strategies to improve mental health and substance use disorder outcomes in California.
(c) (1) The commission shall establish an advisory committee to provide guidance on the fellowship program goals, design, eligibility criteria, application process, and other issues as the commission deems necessary.
(2) The advisory committee shall include persons with personal experience with the mental health and substance use disorder system, mental health and substance use disorder professionals, persons with experience with similar fellowship programs, and others with diverse perspectives who can assist the commission to meet the goals of the fellowship program.
(d) The commission may enter into an interagency agreement or other contractual agreement with a state, local, or private entity, as determined by the commission, to receive technical assistance or relevant services to support the establishment and implementation of the fellowship program.
(e) (1) The commission shall ensure that the fellowship program does not cause the displacement of a civil service employee.
(2) For purposes of this subdivision, “displacement” means a layoff, a demotion, an involuntary transfer to a new class, an involuntary transfer to a new location requiring a change of residence, a time base reduction, a change in shift or days off, or a reassignment to another position within the same class and general location.
(f) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 53.

Section 5846 of the Welfare and Institutions Code is amended to read:

5846.

(a) The commission shall adopt regulations for programs and expenditures pursuant to Part 3.2 (commencing with Section 5830), for innovative programs, and Part 3.6 (commencing with Section 5840), for prevention and early intervention.

(b) Any regulations adopted by the department pursuant to Section 5898 shall be consistent with the commission’s regulations.

(c) The commission may provide technical assistance to any county mental health plan as needed to address concerns or recommendations of the commission or when local programs could benefit from technical assistance for improvement of their plans.

(d) The commission shall ensure that the perspective and participation of diverse community members reflective of California populations and others suffering from severe mental illness and their family members is a significant factor in all of its decisions and recommendations.

SEC. 54.

Section 5847 of the Welfare and Institutions Code is amended to read:

5847.

Integrated Plans for Prevention, Innovation, and System of Care Services.

(a) Each county mental health program shall prepare and submit a three-year program and expenditure plan, and annual updates, adopted by the county board of supervisors, to the Mental Health Services Oversight and Accountability Commission and the State Department of Health Care Services within 30 days after adoption.

(b) The three-year program and expenditure plan shall be based on available unspent funds and estimated revenue allocations provided by the state and in accordance with established stakeholder engagement and planning requirements, as required in Section 5848. The three-year program and expenditure plan and annual updates shall include all of the following:

(1) A program for prevention and early intervention in accordance with Part 3.6 (commencing with Section 5840).

(2) A program for services to children in accordance with Part 4 (commencing with Section 5850), to include a program pursuant to Chapter 4 (commencing with Section 18250) of Part 6 of Division 9 or provide substantial evidence that it is not feasible to establish a wraparound program in that county.

(3) A program for services to adults and seniors in accordance with Part 3 (commencing with Section 5800).

(4) A program for innovations in accordance with Part 3.2 (commencing with Section 5830).

(5) A program for technological needs and capital facilities needed to provide services pursuant to Part 3 (commencing with Section 5800), Part 3.6 (commencing with Section 5840), and Part 4 (commencing with Section 5850). All plans for proposed facilities with restrictive settings shall demonstrate that the needs of the people to be served cannot be met in a less restrictive or more integrated setting, such as permanent supportive housing.

(6) Identification of shortages in personnel to provide services pursuant to the above programs and the additional assistance needed from the education and training programs established pursuant to Part 3.1 (commencing with Section 5820).

(7) Establishment and maintenance of a prudent reserve to ensure the county program will continue to be able to serve children, adults, and seniors that it is currently serving pursuant to Part 3 (commencing with Section 5800), the Adult and Older Adult Mental Health System of Care Act, Part 3.6 (commencing with Section 5840), Prevention and Early Intervention Programs, and Part 4 (commencing with Section 5850), the Children’s Mental Health Services Act, during years in which revenues for the Mental Health Services Fund are below recent averages adjusted by changes in the state population and the California Consumer Price Index.

(8) Certification by the county behavioral health director, which ensures that the county has complied with all pertinent regulations, laws, and statutes of the Mental Health Services Act, including stakeholder participation and nonsupplantation requirements.

(9) Certification by the county behavioral health director and by the county auditor-controller that the county has complied with any fiscal accountability requirements as directed by the State Department of Health Care Services, and that all expenditures are consistent with the requirements of the Mental Health Services Act.

(c) The programs established pursuant to paragraphs (2) and (3) of subdivision (b) shall include services to address the needs of transition age youth 16 to 25 years of age. In implementing this subdivision, county mental health programs shall consider the needs of transition age foster youth.

(d) Each year, the State Department of Health Care Services shall inform the County Behavioral Health Directors Association of California and the Mental Health Services Oversight and Accountability Commission of the methodology used for revenue allocation to the counties.

(e) Each county mental health program shall prepare expenditure plans pursuant to Part 3 (commencing with Section 5800) for adults and seniors, Part 3.2 (commencing with Section 5830) for innovative programs, Part 3.6 (commencing with Section 5840) for prevention and early intervention programs, and Part 4 (commencing with Section 5850) for services for children, and updates to the plans developed pursuant to this section. Each expenditure update shall indicate the number of children, adults, and seniors to be served pursuant to Part 3 (commencing with Section ~~5800),~~ 5800) and Part 4 (commencing with Section ~~5850),~~ 5850) and the cost per person. The expenditure update shall include utilization of unspent funds allocated in the previous year and the proposed expenditure for the same purpose.

(f) A county mental health program shall include an allocation of funds from a reserve established pursuant to paragraph (7) of subdivision (b) for services pursuant to paragraphs (2) and (3) of subdivision (b) in years in which the allocation of funds for services pursuant to subdivision (e) are not adequate to continue to serve the same number of individuals as the county had been serving in the previous fiscal year.

(g) The department shall post on its internet website the three-year program and expenditure plans submitted by every county pursuant to subdivision (a) in a timely manner.

(h) (1) Notwithstanding subdivision (a), a county that is unable to complete and submit a three-year program and expenditure plan or annual update for the 2020–21 or 2021–22 fiscal years due to the COVID-19 Public Health Emergency may extend the effective timeframe of its currently approved three-year plan or annual update to include the 2020–21 and 2021–22 fiscal years. The county shall submit a three-year program and expenditure plan or annual update to the Mental Health Services Oversight and Accountability Commission and the State Department of Health Care Services by July 1, 2022.

(2) For purposes of this subdivision, “COVID-19 Public Health Emergency” means the federal Public Health Emergency declaration made pursuant to Section 247d of Title 42 of the United States Code on January 30, 2020, entitled “Determination that a Public Health Emergency Exists Nationwide as the Result of the 2019 Novel Coronavirus,” and any renewal of that declaration.

(i) Notwithstanding paragraph (7) of subdivision (b) and subdivision (f), a county may, during the 2020–21 and 2021–22 fiscal years, use funds from its prudent reserve for prevention and early intervention programs created in accordance with Part 3.6 (commencing with Section 5840) and for services to persons with severe mental illnesses pursuant to Part 4 (commencing with Section 5850) for the children’s system of care and Part 3 (commencing with Section 5800) for the adult and older adult system of care. These services may include housing assistance, as defined in Section 5892.5, to the target population specified in Section 5600.3.

(j) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department, without taking any further regulatory action, may implement, interpret, or make specific subdivisions (h) and (i) of this section and subdivision (i) of Section 5892 by means of all-county letters or other similar instructions.

(k) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 55.

Section 5848 of the Welfare and Institutions Code is amended to read:

5848.

(a) Each three-year program and expenditure plan and update shall be developed with local stakeholders, including adults and seniors with severe mental illness, families of children, adults, and seniors with severe mental illness, providers of services, law enforcement agencies, education, social services agencies, veterans, representatives from veterans organizations, providers of alcohol and drug services, health care organizations, and other important interests. Counties shall demonstrate a partnership with constituents and stakeholders throughout the process that includes meaningful stakeholder involvement on mental health policy, program planning, and implementation, monitoring, quality improvement, evaluation, and budget allocations. A draft plan and update shall be prepared and circulated for review and comment for at least 30 days to representatives of stakeholder interests and any interested party who has requested a copy of the draft plans.

(b) The mental health board established pursuant to Section 5604 shall conduct a public hearing on the draft three-year program and expenditure plan and annual updates at the close of the 30-day comment period required by subdivision (a). Each adopted three-year program and expenditure plan and update shall include any substantive written recommendations for revisions. The adopted three-year program and expenditure plan or update shall summarize and analyze the recommended revisions. The mental health board shall review the adopted plan or update and make recommendations to the local mental health agency or local behavioral health agency, as applicable, for revisions. The local mental health agency or local behavioral health agency, as applicable, shall provide an annual report of written explanations to the local governing body and the State Department of Health Care Services for any substantive recommendations made by the local mental health board that are not included in the final plan or update.

(c) The plans shall include reports on the achievement of performance outcomes for services pursuant to Part 3 (commencing with Section 5800), Part 3.6 (commencing with Section 5840), and Part 4 (commencing with Section 5850) funded by the Mental Health Services Fund and established jointly by the State Department of Health Care Services and the Mental Health Services Oversight and Accountability Commission, in collaboration with the County Behavioral Health Directors Association of California.

(d) Mental health services provided pursuant to Part 3 (commencing with Section 5800) and Part 4 (commencing with Section 5850) shall be included in the review of program performance by the California Behavioral Health Planning Council required by paragraph (2) of subdivision (c) of Section 5772 and in the local mental health board’s review and comment on the performance outcome data required by paragraph (7) of subdivision (a) of Section 5604.2.

(e) The department shall annually post on its internet website a summary of the performance outcomes reports submitted by counties if clearly and separately identified by counties as the achievement of performance outcomes pursuant to subdivision (c).

(f) For purposes of this section, “substantive recommendations made by the local mental health board” means any recommendation that is brought before the board and approved by a majority vote of the membership present at a public hearing of the local mental health board that has established its quorum.

(g) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 56.

Section 5848.5 of the Welfare and Institutions Code is amended to read:

5848.5.

(a) The Legislature finds and declares all of the following:

(1) California has realigned public community mental health services to counties and it is imperative that sufficient community-based resources be available to meet the mental health needs of eligible individuals.

(2) Increasing access to effective prevention, early intervention, outpatient, and crisis stabilization services provides an opportunity to reduce costs associated with expensive inpatient and emergency room care and to better meet the needs of individuals with mental health disorders in the least restrictive manner possible.

(3) Almost one-fifth of people with mental health disorders visit a hospital emergency room at least once per year. If an adequate array of crisis services is not available, it leaves an individual with little choice but to access an emergency room for assistance and, potentially, an unnecessary inpatient hospitalization.

(4) Recent reports have called attention to a continuing problem of inappropriate and unnecessary utilization of hospital emergency rooms in California due to limited community-based services for individuals in psychological distress and acute psychiatric crisis. Hospitals report that 70 percent of people taken to emergency rooms for psychiatric evaluation can be stabilized and transferred to a less intensive level of crisis care. Law enforcement personnel report that their personnel need to stay with people in the emergency room waiting area until a placement is found, and that less intensive levels of care tend not to be available.

(5) Comprehensive public and private partnerships at both local and regional levels, including across physical health services, mental health, substance use disorder, law enforcement, social services, and related supports, are necessary to develop and maintain ~~high quality,~~ high-quality, patient-centered, and cost-effective care for individuals with mental health disorders that facilitates their recovery and leads towards wellness.

(6) The recovery of individuals with mental health disorders is important for all levels of government, business, and the local community.

(b) This section shall be known, and may be cited, as the Investment in Mental Health Wellness Act of 2013. The objectives of this section are to do all of the following:

(1) Expand access to prevention, early intervention, and treatment services to improve the client experience, achieve recovery and wellness, and reduce costs.

(2) Expand the continuum of services to address crisis prevention, crisis intervention, crisis stabilization, and crisis residential treatment needs that are wellness, resiliency, and recovery oriented.

(3) Add at least 25 mobile crisis support teams and at least 2,000 crisis stabilization and crisis residential treatment beds to bolster capacity at the local level to improve access to mental health crisis services and address unmet mental health care needs.

(4) Add at least 600 triage personnel to provide intensive case management and linkage to services for individuals with mental health care disorders at various points of access, such as at designated community-based service points, homeless shelters, and clinics.

(5) Reduce unnecessary hospitalizations and inpatient days by appropriately utilizing community-based services and improving access to timely assistance.

(6) Reduce recidivism and mitigate unnecessary expenditures of local law enforcement.

(7) Provide local communities with increased financial resources to leverage additional public and private funding sources to achieve improved networks of care for individuals with mental health disorders.

(8) Provide a complete continuum of crisis services for children and youth 21 years of age and under regardless of where they live in the state. The funds included in the 2016 Budget Act for the purpose of developing the continuum of mental health crisis services for children and youth 21 years of age and under shall be for the following objectives:

(A) Provide a continuum of crisis services for children and youth 21 years of age and under, regardless of where they live in the state.

(B) Provide for early intervention and treatment services to improve the client experience, achieve recovery and wellness, and reduce costs.

(C) Expand the continuum of community-based services to address crisis intervention, crisis stabilization, and crisis residential treatment needs that are wellness-, resiliency-, and recovery-oriented.

(D) Add at least 200 mobile crisis support teams.

(E) Add at least 120 crisis stabilization services and beds and crisis residential treatment beds to increase capacity at the local level to improve access to mental health crisis services and address unmet mental health care needs.

(F) Add triage personnel to provide intensive case management and linkage to services for individuals with mental health care disorders at various points of access, such as at designated community-based service points, homeless shelters, schools, and clinics.

(G) Expand family respite care to help families and sustain caregiver health and well-being.

(H) Expand family supportive training and related services designed to help families participate in the planning process, access services, and navigate programs.

(I) Reduce unnecessary hospitalizations and inpatient days by appropriately utilizing community-based services.

(J) Reduce recidivism and mitigate unnecessary expenditures of local law enforcement.

(K) Provide local communities with increased financial resources to leverage additional public and private funding sources to achieve improved networks of care for children and youth 21 years of age and under with mental health disorders.

(c) Through appropriations provided in the annual Budget Act for this purpose, it is the intent of the Legislature to authorize the California Health Facilities Financing Authority, hereafter referred to as the authority, and the Mental Health Services Oversight and Accountability Commission, hereafter referred to as the commission, to administer competitive selection processes or a sole-source contracting process as provided in this section for capital capacity and program expansion to increase capacity for mobile crisis support, crisis intervention, crisis stabilization services, crisis residential treatment, and specified personnel resources.

(d) Funds appropriated by the Legislature to the authority for purposes of this section shall be made available to selected counties, or counties acting jointly. The authority may, at its discretion, also give consideration to private nonprofit corporations and public agencies in an area or region of the state if a county, or counties acting jointly, affirmatively supports this designation and collaboration in lieu of a county government directly receiving grant funds.

(1) Grant awards made by the authority shall be used to expand local resources for the development, capital, equipment acquisition, and applicable program startup or expansion costs to increase capacity for client assistance and services in the following areas:

(A) Crisis intervention, as authorized by Sections 14021.4, 14680, and 14684.

(B) Crisis stabilization, as authorized by Sections 14021.4, 14680, and 14684.

(C) Crisis residential treatment, as authorized by Sections 14021.4, 14680, and 14684 and as provided at a children’s crisis residential program, as defined in Section 1502 of the Health and Safety Code.

(D) Rehabilitative mental health services, as authorized by Sections 14021.4, 14680, and 14684.

(E) Mobile crisis support teams, including personnel and equipment, such as the purchase of vehicles.

(2) The authority shall develop selection criteria to expand local resources, including those described in paragraph (1), and processes for awarding grants after consulting with representatives and interested stakeholders from the mental health community, including, but not limited to, the County Behavioral Health Directors Association of California, service providers, consumer organizations, and other appropriate interests, such as health care providers and law enforcement, as determined by the authority. The authority shall ensure that grants result in cost-effective expansion of the number of community-based crisis resources in regions and communities selected for funding. The authority shall also take into account at least the following criteria and factors when selecting recipients of grants and determining the amount of grant awards:

(A) Description of need, including, at a minimum, a comprehensive description of the project, community need, population to be served, linkage with other public systems of health and mental health care, linkage with local law enforcement, social services, and related assistance, as applicable, and a description of the request for funding.

(B) Ability to serve the target population, which includes individuals eligible for Medi-Cal and individuals eligible for county health and mental health services.

(C) Geographic areas or regions of the state to be eligible for grant awards, which may include rural, suburban, and urban areas, and may include use of the five regional designations utilized by the County Behavioral Health Directors Association of California.

(D) Level of community engagement and commitment to project completion.

(E) Financial support that, in addition to a grant that may be awarded by the authority, will be sufficient to complete and operate the project for which the grant from the authority is awarded.

(F) Ability to provide additional funding support to the project, including public or private funding, federal tax credits and grants, foundation support, and other collaborative efforts.

(G) Memorandum of understanding among project partners, if applicable.

(H) Information regarding the legal status of the collaborating partners, if applicable.

(I) Ability to measure key outcomes, including improved access to services, health and mental health outcomes, and cost benefit of the project.

(3) The authority shall determine maximum grants awards, which shall take into consideration the number of projects awarded to the grantee, as described in paragraph (1), and shall reflect reasonable costs for the project and geographic region. The authority may allocate a grant in increments contingent upon the phases of a project.

(4) Funds awarded by the authority pursuant to this section may be used to supplement, but not to supplant, existing financial and resource commitments of the grantee or any other member of a collaborative effort that has been awarded a grant.

(5) All projects that are awarded grants by the authority shall be completed within a reasonable period of time, to be determined by the authority. Funds shall not be released by the authority until the applicant demonstrates project readiness to the authority’s satisfaction. If the authority determines that a grant recipient has failed to complete the project under the terms specified in awarding the grant, the authority may require remedies, including the return of all or a portion of the grant.

(6) A grantee that receives a grant from the authority under this section shall commit to using that capital capacity and program expansion project, such as the mobile crisis team, crisis stabilization unit, or crisis residential treatment program, for the duration of the expected life of the project.

(7) The authority may consult with a technical assistance entity, as described in paragraph (5) of subdivision (a) of Section 4061, for purposes of implementing this section.

(8) The authority may adopt emergency regulations relating to the grants for the capital capacity and program expansion projects described in this section, including emergency regulations that define eligible costs and determine minimum and maximum grant amounts.

(9) The authority shall provide reports to the fiscal and policy committees of the Legislature on or before May 1, 2014, and on or before May 1, 2015, on the progress of implementation, that include, but are not limited to, the following:

(A) A description of each project awarded funding.

(B) The amount of each grant issued.

(D) The total amount of grants issued.

(E) A description of project operation and implementation, including who is being served.

(10) A recipient of a grant provided pursuant to paragraph (1) shall adhere to all applicable laws relating to scope of practice, licensure, certification, staffing, and building codes.

(e) Of the funds specified in paragraph (8) of subdivision (b), it is the intent of the Legislature to authorize the authority to administer competitive selection processes as provided in this section for capital capacity and program expansion to increase capacity for mobile crisis support, crisis intervention, crisis stabilization services, crisis residential treatment, family respite care, family supportive training and related services, and triage personnel resources for children and youth 21 years of age and under.

(f) Funds appropriated by the Legislature to the authority to address crisis services for children and youth 21 years of age and under for the purposes of this section shall be made available to selected counties or counties acting jointly. The authority may, at its discretion, also give consideration to private nonprofit corporations and public agencies in an area or region of the state if a county, or counties acting jointly, affirmatively support this designation and collaboration in lieu of a county government directly receiving grant funds.

(A) Crisis intervention, as authorized by Sections 14021.4, 14680, and 14684.

(B) Crisis stabilization, as authorized by Sections 14021.4, 14680, and 14684.

(D) Mobile crisis support teams, including the purchase of equipment and vehicles.

(E) Family respite care.

(2) The authority shall develop selection criteria to expand local resources, including those described in paragraph (1), and processes for awarding grants after consulting with representatives and interested stakeholders from the mental health community, including, but not limited to, county mental health directors, service providers, consumer organizations, and other appropriate interests, such as health care providers and law enforcement, as determined by the authority. The authority shall ensure that grants result in cost-effective expansion of the number of community-based crisis resources in regions and communities selected for funding. The authority shall also take into account at least the following criteria and factors when selecting recipients of grants and determining the amount of grant awards:

(B) Ability to serve the target population, which includes individuals eligible for Medi-Cal and individuals eligible for county health and mental health services.

(D) Level of community engagement and commitment to project completion.

(E) Financial support that, in addition to a grant that may be awarded by the authority, will be sufficient to complete and operate the project for which the grant from the authority is awarded.

(F) Ability to provide additional funding support to the project, including public or private funding, federal tax credits and grants, foundation support, and other collaborative efforts.

(G) Memorandum of understanding among project partners, if applicable.

(H) Information regarding the legal status of the collaborating partners, if applicable.

(I) Ability to measure key outcomes, including utilization of services, health and mental health outcomes, and cost benefit of the project.

(3) The authority shall determine maximum grant awards, which shall take into consideration the number of projects awarded to the grantee, as described in paragraph (1), and shall reflect reasonable costs for the project, geographic region, and target ages. The authority may allocate a grant in increments contingent upon the phases of a project.

(6) A grantee that receives a grant from the authority under this section shall commit to using that capital capacity and program expansion project, such as the mobile crisis team, crisis stabilization unit, family respite care, or crisis residential treatment program, for the duration of the expected life of the project.

(7) The authority may consult with a technical assistance entity, as described in paragraph (5) of subdivision (a) of Section 4061, for the purposes of implementing this section.

(9) The authority shall provide reports to the fiscal and policy committees of the Legislature on or before January 10, 2018, and annually thereafter, on the progress of implementation, that include, but are not limited to, the following:

(A) A description of each project awarded funding.

(B) The amount of each grant issued.

(D) The total amount of grants issued.

(E) A description of project operation and implementation, including who is being served.

(10) A recipient of a grant provided pursuant to paragraph (1) shall adhere to all applicable laws relating to scope of practice, licensure, certification, staffing, and building codes.

(g) Funds appropriated by the Legislature to the commission for purposes of this section shall be allocated to support crisis prevention, early intervention, and crisis response strategies, as determined by the commission with input from peers, county behavioral health agencies, community-based organizations, and others. In allocating these funds, the commission shall consult with the California Health and Human Services Agency and other state agencies as needed, in order to leverage existing funds and share best practices, and shall take into consideration data on populations at risk for experiencing a mental health crisis, including the needs of early childhood, children and youth, transition-age youth, adults, and older adults. These funds shall be made available to selected entities, including, but not limited to, counties, counties acting jointly, city mental health departments, other local governmental agencies and community-based organizations such as health care providers, hospitals, health systems, childcare providers, early childhood education providers, and other entities, as determined by the commission through a competitive selection process or a sole-source process, as determined by the commission. The commission may utilize a sole-source process when it determines, during a public hearing, that it is in the public interest to do so and would address barriers to participation for local governmental agencies, including small counties, other local agencies, and community-based organizations, or is aligned with the goals of this section. It is the intent of the Legislature for these funds to be allocated in an efficient manner to encourage prevention, early intervention, and receipt of needed services for individuals with mental health needs, or who are at risk of needing crisis services, and to assist in navigating the local service sector to improve efficiencies and the delivery of services. The commission shall consider existing data sources for populations who are at higher risk for experiencing a mental health crisis when allocating these funds.

(1) Funding may be used to support services, supports, education, and training that are offered in person, by telephone, by videoconference, or by telehealth with the individual in need of assistance, their significant support person, or others, and may be provided anywhere in the community. These service and related activities may include, but are not limited to, the following:

(A) Communication, coordination, and referral.

(B) Monitoring service delivery to ensure the individual accesses and receives services.

(D) Providing placement service assistance and service plan development.

(E) Education and training.

(F) Innovative, best practice, evidence-based, and related approaches to support crisis prevention, early intervention, and crisis response.

(2) The commission shall take into account at least the following criteria and factors when selecting recipients and determining the amount of grant awards as follows:

(A) Description of need, including potential gaps in local service connections.

(B) Description of funding request, including use of peers and peer support.

(C) Description of how funding will be used to facilitate linkage and access to services, including objectives and anticipated outcomes.

(D) Ability to obtain federal Medicaid reimbursement, when applicable.

(E) Ability to administer an effective service program and the degree to which local agencies and service providers will support and collaborate with the effort.

(F) Geographic areas or regions of the state to be eligible for grant awards, which shall include rural, suburban, and urban areas, and may include use of the five regional designations utilized by the County Behavioral Health Directors Association of California.

(3) The commission shall determine maximum grant awards, and shall take into consideration the level of need, population to be served, and related criteria, as described in paragraph (2), and shall reflect reasonable costs.

(4) Funds awarded by the commission for purposes of this section may be used to supplement, but not supplant, existing financial and resource commitments of the entities that receive the grant.

(5) Notwithstanding any other law, a county, counties acting jointly, a city mental health department, a community-based organization, or other entity that receives an award of funds for the purpose of supporting crisis prevention, early intervention, and crisis response strategies pursuant to this subdivision may be required to provide a matching contribution of local funds. The commission may, at its discretion, allow and approve grants that include matching funds, in whole or in part, to enhance the impact of limited public funding. Matching fund requirements shall not be designed in a manner that will prevent participation from local agencies, community-based organizations, or other entities that are eligible to participate in the funding opportunities created by this section.

(6) Notwithstanding any other law, the commission, without taking any further regulatory action, may implement, interpret, or make specific this section by means of informational letters, bulletins, or similar instructions.

(h) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 57.

Section 5848.5 is added to the Welfare and Institutions Code, to read:

5848.5.
(a) The Legislature finds and declares all of the following:
(1) California has realigned public community mental health services to counties, and it is imperative that sufficient community-based resources be available to meet the mental health needs of eligible individuals.
(2) Increasing access to effective prevention, early intervention, outpatient, and crisis stabilization services provides an opportunity to reduce costs associated with expensive inpatient and emergency room care and better meet the needs of individuals with mental health disorders in the least restrictive manner possible.
(3) Almost one-fifth of people with mental health disorders visit a hospital emergency room at least once per year. If an adequate array of crisis services is not available, it leaves an individual with little choice but to access an emergency room for assistance and, potentially, an unnecessary inpatient hospitalization.
(4) Recent reports have called attention to a continuing problem of inappropriate and unnecessary utilization of hospital emergency rooms in California due to limited community-based services for individuals in psychological distress and acute psychiatric crisis. Hospitals report that 70 percent of people taken to emergency rooms for psychiatric evaluation can be stabilized and transferred to a less-intensive level of crisis care. Law enforcement personnel report that their personnel need to stay with people in the emergency room waiting area until a placement is found and that less intensive levels of care tend not to be available.
(5) Comprehensive public and private partnerships at both local and regional levels, including across physical health services, mental health, substance use disorder, law enforcement, social services, and related supports, are necessary to develop and maintain high-quality, patient-centered, and cost-effective care for individuals with mental health disorders that facilitates their recovery and leads towards wellness.
(6) The recovery of individuals with mental health disorders is important for all levels of government, business, and the local community.
(b) This section shall be known, and may be cited, as the Investment in Mental Health Wellness Act of 2013. The objectives of this section are to do all of the following:
(1) Expand access to prevention, early intervention, and treatment services to improve the client experience, achieve recovery and wellness, and reduce costs.
(2) Expand the continuum of services to address crisis prevention, crisis intervention, crisis stabilization, and crisis residential treatment needs that are wellness-, resiliency-, and recovery-oriented.
(3) Add at least 25 mobile crisis support teams and at least 2,000 crisis stabilization and crisis residential treatment beds to bolster capacity at the local level to improve access to mental health crisis services and address unmet mental health care needs.
(4) Add at least 600 triage personnel to provide intensive case management and linkage to services for individuals with a mental health disorder at various points of access, such as at designated community-based service points, homeless shelters, and clinics.
(5) Reduce unnecessary hospitalizations and inpatient days by appropriately utilizing community-based services and improving access to timely assistance.
(6) Reduce recidivism and mitigate unnecessary expenditures of local law enforcement.
(7) Provide local communities with increased financial resources to leverage additional public and private funding sources to achieve improved networks of care for individuals with mental health disorders.
(8) (A) Provide a complete continuum of crisis services for children and youth 21 years of age and under regardless of where they live in the state.
(B) The funds included in the 2016 Budget Act for the purpose of developing the continuum of mental health crisis services for children and youth 21 years of age and under shall be for the following objectives:
(i) Provide a continuum of crisis services for children and youth 21 years of age and under, regardless of where they live in the state.
(ii) Provide for early intervention and treatment services to improve the client experience, achieve recovery and wellness, and reduce costs.
(iii) Expand the continuum of community-based services to address crisis intervention, crisis stabilization, and crisis residential treatment needs that are wellness-, resiliency-, and recovery-oriented.
(iv) Add at least 200 mobile crisis support teams.
(v) Add at least 120 crisis stabilization services and beds and crisis residential treatment beds to increase capacity at the local level and improve access to mental health crisis services and address unmet mental health care needs.
(vi) Add triage personnel to provide intensive case management and linkage to services for individuals with mental health disorders at various points of access, such as at designated community-based service points, homeless shelters, schools, and clinics.
(vii) Expand family respite care to help families and sustain caregiver health and well-being.
(viii) Expand family supportive training and related services designed to help families participate in the planning process, access services, and navigate programs.
(ix) Reduce unnecessary hospitalizations and inpatient days by appropriately utilizing community-based services.
(x) Reduce recidivism and mitigate unnecessary expenditures of local law enforcement.
(xi) Provide local communities with increased financial resources to leverage additional public and private funding sources to achieve improved networks of care for children and youth 21 years of age and under with a mental health disorder.
(c) Through appropriations provided in the annual Budget Act for this purpose, it is the intent of the Legislature to authorize the California Health Facilities Financing Authority, hereafter referred to as the authority, and the Behavioral Health Services Oversight and Accountability Commission, hereafter referred to as the commission, to administer competitive selection processes or a sole-source contracting process as provided in this section for capital capacity and program expansion to increase capacity for mobile crisis support, crisis intervention, crisis stabilization services, crisis residential treatment, and specified personnel resources.
(d) (1) Funds appropriated by the Legislature to the authority for purposes of this section shall be made available to selected counties or counties acting jointly.
(2) The authority may, at its discretion, give consideration to private nonprofit corporations and public agencies in an area or region of the state if a county, or counties acting jointly, affirmatively supports this designation and collaboration in lieu of a county government directly receiving grant funds.
(3) Grant awards made by the authority shall be used to expand local resources for the development, capital, equipment acquisition, and applicable program startup or expansion costs to increase capacity for client assistance and services in the following areas:
(A) Crisis intervention as authorized by Sections 14021.4, 14680, and 14684.
(B) Crisis stabilization as authorized by Sections 14021.4, 14680, and 14684.
(C) Crisis residential treatment as authorized by Sections 14021.4, 14680, and 14684 and as provided at a children’s crisis residential program as defined in Section 1502 of the Health and Safety Code.
(D) Rehabilitative mental health services as authorized by Sections 14021.4, 14680, and 14684.
(E) Mobile crisis support teams, including personnel and equipment, such as the purchase of vehicles.
(4) (A) The authority shall develop selection criteria to expand local resources, including those described in paragraph (3), and processes for awarding grants after consulting with representatives and interested stakeholders from the mental health community, including, but not limited to, the County Behavioral Health Directors Association of California, service providers, consumer organizations, and other appropriate interests, such as health care providers and law enforcement, as determined by the authority.
(B) The authority shall ensure that grants result in cost-effective expansion of the number of community-based crisis resources in regions and communities selected for funding.
(C) The authority shall also take into account at least the following criteria and factors when selecting recipients of grants and determining the amount of grant awards:
(i) Description of need, including, at a minimum, a comprehensive description of the project, community need, population to be served, linkage with other public systems of health and mental health care, linkage with local law enforcement, social services, and related assistance, as applicable, and a description of the request for funding.
(ii) Ability to serve the target population, which includes individuals eligible for Medi-Cal and individuals eligible for county health and mental health services.
(iii) Geographic areas or regions of the state to be eligible for grant awards, which may include rural, suburban, and urban areas, and may include use of the five regional designations utilized by the County Behavioral Health Directors Association of California.
(iv) Level of community engagement and commitment to project completion.
(v) Financial support that, in addition to a grant that may be awarded by the authority, will be sufficient to complete and operate the project for which the grant from the authority is awarded.
(vi) Ability to provide additional funding support to the project, including public or private funding, federal tax credits and grants, foundation support, and other collaborative efforts.
(vii) Memorandum of understanding among project partners, if applicable.
(viii) Information regarding the legal status of the collaborating partners, if applicable.
(ix) Ability to measure key outcomes, including improved access to services, health, and mental health outcomes, and cost benefit of the project.
(5) (A) The authority shall determine maximum grants awards, which shall take into consideration the number of projects awarded to the grantee, as described in paragraph (3), and shall reflect reasonable costs for the project and geographic region.
(B) The authority may allocate a grant in increments contingent upon the phases of a project.
(6) Funds awarded by the authority pursuant to this section may be used to supplement, but not to supplant, existing financial and resource commitments of the grantee or another member of a collaborative effort that has been awarded a grant.
(7) (A) All projects that are awarded grants by the authority shall be completed within a reasonable period of time, to be determined by the authority.
(B) Funds shall not be released by the authority until the applicant demonstrates project readiness to the authority’s satisfaction.
(C) If the authority determines that a grant recipient has failed to complete the project under the terms specified in awarding the grant, the authority may require remedies, including the return of all or a portion of the grant.
(8) A grantee that receives a grant from the authority under this section shall commit to using that capital capacity and program expansion project, such as the mobile crisis team, crisis stabilization unit, or crisis residential treatment program, for the duration of the expected life of the project.
(9) The authority may consult with a technical assistance entity, as described in paragraph (5) of subdivision (a) of Section 4061, for purposes of implementing this section.
(10) The authority may adopt emergency regulations relating to the grants for the capital capacity and program expansion projects described in this section, including emergency regulations that define eligible costs and determine minimum and maximum grant amounts.
(11) The authority shall provide reports to the fiscal and policy committees of the Legislature on or before May 1, 2014, and on or before May 1, 2015, on the progress of implementation, that include, but are not limited to, the following:
(A) A description of each project awarded funding.
(B) The amount of each grant issued.
(C) A description of other sources of funding for each project.
(D) The total amount of grants issued.
(E) A description of project operation and implementation, including who is being served.
(12) A recipient of a grant provided pursuant to paragraph (1) shall adhere to all applicable laws relating to scope of practice, licensure, certification, workforce, and building codes.
(e) Of the funds specified in paragraph (8) of subdivision (b), it is the intent of the Legislature to authorize the authority to administer competitive selection processes as provided in this section for capital capacity and program expansion to increase capacity for mobile crisis support, crisis intervention, crisis stabilization services, crisis residential treatment, family respite care, family supportive training and related services, and triage personnel resources for children and youth 21 years of age and under.
(f) (1) Funds appropriated by the Legislature to the authority to address crisis services for children and youth 21 years of age and under for the purposes of this section shall be made available to selected counties or counties acting jointly.
(2) The authority may, at its discretion, also give consideration to private nonprofit corporations and public agencies in an area or region of the state if a county, or counties acting jointly, affirmatively support this designation and collaboration in lieu of a county government directly receiving grant funds.
(3) Grant awards made by the authority shall be used to expand local resources for the development, capital, equipment acquisition, and applicable program startup or expansion costs to increase capacity for client assistance and crisis services for children and youth 21 years of age and under in the following areas:
(A) Crisis intervention as authorized by Sections 14021.4, 14680, and 14684.
(B) Crisis stabilization as authorized by Sections 14021.4, 14680, and 14684.
(C) Crisis residential treatment as authorized by Sections 14021.4, 14680, and 14684 and as provided at a children’s crisis residential program as defined in Section 1502 of the Health and Safety Code.
(D) Mobile crisis support teams, including the purchase of equipment and vehicles.
(E) Family respite care.
(4) (A) The authority shall develop selection criteria to expand local resources, including those described in paragraph (3), and processes for awarding grants after consulting with representatives and interested stakeholders from the mental health community, including, but not limited to, county mental health directors, service providers, consumer organizations, and other appropriate interests, such as health care providers and law enforcement, as determined by the authority.
(B) The authority shall ensure that grants result in cost-effective expansion of the number of community-based crisis resources in regions and communities selected for funding.
(C) The authority shall also take into account at least the following criteria and factors when selecting recipients of grants and determining the amount of grant awards:
(i) Description of need, including, at a minimum, a comprehensive description of the project, community need, population to be served, linkage with other public systems of health and mental health care, linkage with local law enforcement, social services, and related assistance, as applicable, and a description of the request for funding.
(ii) Ability to serve the target population, which includes individuals eligible for Medi-Cal and individuals eligible for county health and mental health services.
(iii) Geographic areas or regions of the state to be eligible for grant awards, which may include rural, suburban, and urban areas, and may include use of the five regional designations utilized by the California Behavioral Health Directors Association.
(iv) Level of community engagement and commitment to project completion.
(v) Financial support that, in addition to a grant that may be awarded by the authority, will be sufficient to complete and operate the project for which the grant from the authority is awarded.
(vi) Ability to provide additional funding support to the project, including public or private funding, federal tax credits and grants, foundation support, and other collaborative efforts.
(vii) Memorandum of understanding among project partners, if applicable.
(viii) Information regarding the legal status of the collaborating partners, if applicable.
(ix) Ability to measure key outcomes, including utilization of services, health and mental health outcomes, and cost benefit of the project.
(5) (A) The authority shall determine maximum grant awards, which shall take into consideration the number of projects awarded to the grantee, as described in paragraph (1), and shall reflect reasonable costs for the project, geographic region, and target ages.
(B) The authority may allocate a grant in increments contingent upon the phases of a project.
(6) Funds awarded by the authority pursuant to this section may be used to supplement, but not to supplant, existing financial and resource commitments of the grantee or another member of a collaborative effort that has been awarded a grant.
(7) (A) All projects that are awarded grants by the authority shall be completed within a reasonable period of time, to be determined by the authority.
(B) Funds shall not be released by the authority until the applicant demonstrates project readiness to the authority’s satisfaction.
(C) If the authority determines that a grant recipient has failed to complete the project under the terms specified in awarding the grant, the authority may require remedies, including the return of all, or a portion, of the grant.
(8) A grantee that receives a grant from the authority under this section shall commit to using that capital capacity and program expansion project, such as the mobile crisis team, crisis stabilization unit, family respite care, or crisis residential treatment program, for the duration of the expected life of the project.
(9) The authority may consult with a technical assistance entity, as described in paragraph (5) of subdivision (a) of Section 4061, for the purposes of implementing this section.
(10) The authority may adopt emergency regulations relating to the grants for the capital capacity and program expansion projects described in this section, including emergency regulations that define eligible costs and determine minimum and maximum grant amounts.
(11) The authority shall provide reports to the fiscal and policy committees of the Legislature on or before January 10, 2018, and annually thereafter, on the progress of implementation, that include, but are not limited to, all of the following:
(A) A description of each project awarded funding.
(B) The amount of each grant issued.
(C) A description of other sources of funding for each project.
(D) The total amount of grants issued.
(E) A description of project operation and implementation, including who is being served.
(12) A recipient of a grant provided pursuant to paragraph (1) shall adhere to all applicable laws relating to scope of practice, licensure, certification, workforce, and building codes.
(g) (1) (A) Funds appropriated by the Legislature to the commission for purposes of this section shall be allocated to support crisis prevention, early intervention, and crisis response strategies, as determined by the commission with input from peers, county behavioral health agencies, community-based organizations, and others.
(B) In allocating these funds, the commission shall consult with the California Health and Human Services Agency and other state agencies as needed, to leverage existing funds and share best practices and shall take into consideration data on populations at risk for experiencing a mental health crisis, including the needs of early childhood, children and youth, transition-age youth, adults, and older adults.
(C) These funds shall be made available to selected entities, including, but not limited to, counties, counties acting jointly, city mental health departments, other local governmental agencies and community-based organizations, such as health care providers, hospitals, health systems, childcare providers, early childhood education providers, and other entities as determined by the commission through a competitive selection process or a sole-source process, as determined by the commission.
(D) The commission may utilize a sole-source process when it determines, during a public hearing, that it is in the public interest to do so and would address barriers to participation for local governmental agencies, including small counties, other local agencies, and community-based organizations or is aligned with the goals of this section.
(E) It is the intent of the Legislature for these funds to be allocated in an efficient manner to encourage prevention, early intervention, and receipt of needed services for individuals with mental health needs, or who are at risk of needing crisis services, and to assist in navigating the local service sector to improve efficiencies and the delivery of services.
(F) The commission shall consider existing data sources for populations who are at higher risk for experiencing a mental health crisis when allocating these funds.
(2) Funding may be used to support services, supports, education, and training that are offered in person, by telephone, by videoconference, or by telehealth with the individual in need of assistance, their significant support person, or others, and may be provided anywhere in the community. These service and related activities may include, but are not limited to, the following:
(A) Communication, coordination, and referral.
(B) Monitoring service delivery to ensure the individual accesses and receives services.
(C) Monitoring the individual’s progress.
(D) Providing placement service assistance and service plan development.
(E) Education and training.
(F) Innovative, best practice, evidence-based, and related approaches to support crisis prevention, early intervention, and crisis response.
(3) The commission shall take into account at least the following criteria and factors when selecting recipients and determining the amount of grant awards as follows:
(A) Description of need, including potential gaps in local service connections.
(B) Description of funding request, including use of peers and peer support.
(C) Description of how funding will be used to facilitate linkage and access to services, including objectives and anticipated outcomes.
(D) Ability to obtain federal Medicaid reimbursement, if applicable.
(E) Ability to administer an effective service program and the degree to which local agencies and service providers will support and collaborate with the effort.
(F) Geographic areas or regions of the state to be eligible for grant awards, which shall include rural, suburban, and urban areas, and may include use of the five regional designations utilized by the County Behavioral Health Directors Association of California.
(4) The commission shall determine maximum grant awards and shall take into consideration the level of need, population to be served, and related criteria, as described in paragraph (2), and shall reflect reasonable costs.
(5) Funds awarded by the commission for purposes of this section may be used to supplement, but not supplant, existing financial and resource commitments of the entities that receive the grant.
(6) (A) Notwithstanding any other law, a county, counties acting jointly, a city mental health department, a community-based organization, or other entity that receives an award of funds for the purpose of supporting crisis prevention, early intervention, and crisis response strategies pursuant to this subdivision may be required to provide a matching contribution of local funds.
(B) The commission may, at its discretion, allow and approve grants that include matching funds, in whole or in part, to enhance the impact of limited public funding. Matching fund requirements shall not be designed in a manner that will prevent participation from local agencies, community-based organizations, or other entities that are eligible to participate in the funding opportunities created by this section.
(7) Notwithstanding any other law, the commission, without taking any further regulatory action, may implement, interpret, or make specific this section by means of informational letters, bulletins, or similar instructions.
(h) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 58.

Section 5849.1 of the Welfare and Institutions Code is amended to read:

5849.1.

(a) The Legislature finds and declares that this part is consistent with and furthers the purposes of the Mental Health Services Act, enacted by Proposition 63 at the November 2, 2004, statewide general election, within the meaning of Section 18 of that measure.

(b) The Legislature further finds and declares all of the following:

(1) Housing is a key factor for stabilization and recovery to occur and results in improved outcomes for individuals living with a mental illness.

(2) Untreated mental illness can increase the risk of homelessness, especially for single adults.

(3) California has the nation’s largest homeless population that is disproportionally comprised of women with children, veterans, and the chronically homeless.

(4) California has the largest number of homeless veterans in the United States at 24 percent of the total population in our nation. Fifty percent of California’s veterans live with serious mental illness and 70 percent have a substance use disorder.

(5) Fifty percent of mothers experiencing homelessness have experienced a major depressive episode since becoming homeless and 36 percent of these mothers live with post-traumatic stress disorder and 41 percent have a substance use disorder.

(6) Ninety-three percent of supportive housing tenants who live with mental illness and substance use disorders voluntarily participated in the services offered.

(7) Adults who receive two years of “whatever-it-takes,” or Full Service Partnership services, experience a 68 percent reduction in homelessness.

(8) For every dollar of bond funds invested in permanent supportive housing, the state and local governments can leverage a significant amount of additional dollars through tax credits, Medicaid health services funding, and other housing development funds.

(9) Tenants of permanent supportive housing reduced their visits to the emergency department by 56 percent, and their hospital admissions by 45 percent.

(10) The cost in public services for a chronically homeless Californian ranges from $60,000 to $100,000 annually. When housed, these costs are cut in half and some reports show reductions in cost of more than 70 percent, including potentially less involvement with the health and criminal justice systems.

(11) Californians have identified homelessness as their top tier priority; this measure seeks to address the needs of the most vulnerable people within this population.

(12) Having counties provide mental health programming and services is a benefit to the state.

(13) The Department of Housing and Community Development is the state entity with sufficient expertise to implement and oversee a grant or loan program for permanent supportive housing of the target population.

(14) The California Health Facilities Financing Authority is authorized by law to issue bonds and to consult with the Mental Health Services Oversight and Accountability Commission and the State Department of Health Care Services concerning the implementation of a grant or loan program for California counties to support the development of programs that increase access to, and capacity for, crisis mental health services. It is therefore appropriate for the authority to issue bonds and contract for services with the Department of Housing and Community Development to provide grants or loans to California counties for permanent supportive housing for the target population.

(15) Use of bond funding will accelerate the availability of funding for the grant or loan program to provide permanent supportive housing for the target population as compared to relying on annual allocations from the Mental Health Services Fund and better allow counties to provide permanent supportive housing for homeless individuals living with mental illness.

(16) The findings and declarations set forth in subdivision (c) of Section 5849.35 are hereby incorporated herein.

(c) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date, is repealed.

SEC. 59.

Section 5849.1 is added to the Welfare and Institutions Code, to read:

5849.1.
(a) The Legislature finds and declares that this part is consistent with and furthers the purposes of the Mental Health Services Act, enacted by Proposition 63 at the November 2, 2004, statewide general election, within the meaning of Section 18 of that measure.
(b) The Legislature further finds and declares all of the following:
(1) Housing is a key factor for stabilization and recovery to occur and results in improved outcomes for individuals living with a mental illness.
(2) Untreated mental illness can increase the risk of homelessness, especially for single adults.
(3) California has the nation’s largest homeless population, which is disproportionally comprised of women with children, veterans, and the chronically homeless.
(4) California has the largest number of homeless veterans in the United States at 24 percent of the total population in our nation. Fifty percent of California’s veterans live with serious mental illness and 70 percent have a substance use disorder.
(5) Fifty percent of mothers experiencing homelessness have experienced a major depressive episode since becoming homeless, and 36 percent of these mothers live with post-traumatic stress disorder and 41 percent have a substance use disorder.
(6) Ninety-three percent of supportive housing tenants who live with mental illness and substance use disorders voluntarily participated in the services offered.
(7) Adults who receive two years of “whatever-it-takes,” or Full-Service Partnership services, experience a 68-percent reduction in homelessness.
(8) For every dollar of bond funds invested in permanent supportive housing, the state and local governments can leverage a significant amount of additional dollars through tax credits, Medicaid health services funding, and other housing development funds.
(9) Tenants of permanent supportive housing reduced their visits to the emergency department by 56 percent and their hospital admissions by 45 percent.
(10) The cost in public services for a chronically homeless Californian ranges from $60,000 to $100,000 annually. When housed, these costs are cut in half and some reports show reductions in cost of more than 70 percent, including potentially less involvement with the health and criminal justice systems.
(11) Californians have identified homelessness as their top tier priority. This measure seeks to address the needs of the most vulnerable people within this population.
(12) Having counties provide mental health programming and services is a benefit to the state.
(13) The Department of Housing and Community Development is the state entity with sufficient expertise to implement and oversee a grant or loan program for permanent supportive housing of the target population.
(14) The California Health Facilities Financing Authority is authorized by law to issue bonds and to consult with the Behavioral Health Services Oversight and Accountability Commission and the State Department of Health Care Services concerning the implementation of a grant or loan program for California counties to support the development of programs that increase access to, and capacity for, crisis mental health services. It is therefore appropriate for the authority to issue bonds and contract for services with the Department of Housing and Community Development to provide grants or loans to California counties for permanent supportive housing for the target population.
(15) Use of bond funding will accelerate the availability of funding for the grant or loan program to provide permanent supportive housing for the target population as compared to relying on annual allocations from the Behavioral Health Services Fund and better allow counties to provide permanent supportive housing for homeless individuals living with mental illness.
(16) The findings and declarations set forth in subdivision (c) of Section 5849.35 are hereby incorporated herein.
(c) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 60.

Section 5849.2 of the Welfare and Institutions Code is amended to read:

5849.2.

As used in this part, the following definitions shall apply:

(a) “At risk of chronic homelessness” includes, but is not limited to, persons who are at high risk of long-term or intermittent homelessness, including persons with mental illness exiting institutionalized settings, including, but not limited to, jail and mental health facilities, who were homeless prior to admission, transition age youth experiencing homelessness or with significant barriers to housing stability, and others, as defined in program guidelines.

(b) “Authority” means the California Health Facilities Financing Authority established pursuant to Part 7.2 (commencing with Section 15430) of Division 3 of Title 2 of the Government Code.

(c) “Chronically homeless” has the same meaning as defined in Section 578.3 of Title 24 of the Code of Federal Regulations, as that section read on May 1, 2016.

(d) “Commission” means the Mental Health Services Oversight and Accountability Commission established by Section 5845.

(e) “Committee” means the No Place Like Home Program Advisory Committee established pursuant to Section 5849.3.

(f) “County” includes, but is not limited to, a city and county, and a city receiving funds pursuant to Section 5701.5.

(g) “Department” means the Department of Housing and Community Development.

(h) “Development sponsor” has the same meaning as “sponsor” as defined in Section 50675.2 of the Health and Safety Code.

(i) “Fund” means the No Place Like Home Fund established pursuant to Section 5849.4.

(j) “Homeless” has the same meaning as defined in Section 578.3 of Title 24 of the Code of Federal Regulations, as that section read on May 1, 2016.

(k) “Permanent supportive housing” has the same meaning as “supportive housing,” as defined in Section 50675.14 of the Health and Safety Code, except that “permanent supportive housing” shall include associated facilities if used to provide services to housing residents.

(l) “Program” means the process for awarding funds and distributing moneys to applicants established in Sections 5849.7, 5849.8, and 5849.9 and the ongoing monitoring and enforcement of the applicants’ activities pursuant to Sections 5849.8, 5849.9, and 5849.11.

(1) “Competitive program” means that portion of the program established by Section 5849.8.

(2) “Distribution program” means that portion of the program described in Section 5849.9.

(m) “Target population” means individuals or households as provided in Section 5600.3 who are homeless, chronically homeless, or at risk of chronic homelessness.

(n) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 61.

Section 5849.2 is added to the Welfare and Institutions Code, to read:

5849.2.
As used in this part, the following definitions shall apply:
(a) “At risk of chronic homelessness” includes, but is not limited to, persons who are at high risk of long-term or intermittent homelessness, including persons with mental illness exiting institutionalized settings, including, but not limited to, jail, mental health, and substance use disorder facilities, who were homeless prior to admission, transition-age youth experiencing homelessness or with significant barriers to housing stability, and others, as defined in program guidelines.
(b) “Authority” means the California Health Facilities Financing Authority established pursuant to Part 7.2 (commencing with Section 15430) of Division 3 of Title 2 of the Government Code.
(c) “Chronically homeless” has the same meaning as defined in Section 578.3 of Title 24 of the Code of Federal Regulations as that section read on May 1, 2016.
(d) “Commission” means the Behavioral Health Services Oversight and Accountability Commission established by Section 5845.
(e) “Committee” means the No Place Like Home Program Advisory Committee established pursuant to Section 5849.3.
(f) “County” includes, but is not limited to, a city and a city and county receiving funds pursuant to Section 5701.5.
(g) “Department” means the Department of Housing and Community Development.
(h) “Development sponsor” has the same meaning as “sponsor” as defined in Section 50675.2 of the Health and Safety Code.
(i) “Fund” means the No Place Like Home Fund established pursuant to Section 5849.4.
(j) “Homeless” has the same meaning as defined in Section 578.3 of Title 24 of the Code of Federal Regulations as that section read on May 1, 2016.
(k) “Permanent supportive housing” has the same meaning as “supportive housing,” as defined in Section 50675.14 of the Health and Safety Code, except that “permanent supportive housing” shall include associated facilities if used to provide services to housing residents.
(l) (1) “Program” means the process for awarding funds and distributing moneys to applicants established in Sections 5849.7, 5849.8, and 5849.9 and the ongoing monitoring and enforcement of the applicants’ activities pursuant to Sections 5849.8, 5849.9, and 5849.11.
(2) “Competitive program” means the portion of the program established by Section 5849.8.
(3) “Distribution program” means the portion of the program described in Section 5849.9.
(m) “Target population” means individuals or households, as provided in Section 5600.3, who are homeless, chronically homeless, or at risk of chronic homelessness.
(n) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 62.

Section 5849.3 of the Welfare and Institutions Code is amended to read:

5849.3.

(a) There is hereby established the No Place Like Home Program Advisory Committee. Membership on the committee shall be as follows:

(1) The Director of Housing and Community Development, or ~~his or her~~ their designee, who shall serve as the chairperson of the committee.

(2) The Director of Health Care Services, or ~~his or her~~ their designee, and an additional representative.

(3) The Secretary of Veterans Affairs, or ~~his or her~~ their designee.

(4) The Director of Social Services, or ~~his or her~~ their designee.

(5) The Treasurer, or ~~his or her~~ their designee.

(6) The Chair of the Mental Health Services Oversight and Accountability Commission, or ~~his or her~~ their designee.

(7) A chief administrative officer of a small county or a member of a county board of supervisors of a small county, as provided by subdivision (d) of Section 5849.6, to be appointed by the Governor.

(8) A chief administrative officer of a large county or a member of a county board of supervisors of a large county, as provided by subdivision (b) of Section 5849.6, to be appointed by the Governor.

(9) A director of a county behavioral health department, to be appointed by the Governor.

(10) An administrative officer of a city, to be appointed by the Governor.

(11) A representative of an affordable housing organization, to be appointed by the Speaker of the Assembly.

(12) A resident of supportive housing, to be appointed by the Governor.

(13) A representative of a community mental health organization, to be appointed by the Senate Committee on Rules.

(14) A representative of a local or regional continuum of care organization that coordinates homelessness funding, to be appointed by the Governor.

(b) The committee shall do all of the following:

(1) Assist and advise the department in the implementation of the program.

(2) Review and make recommendations on the department’s guidelines.

(3) Review the department’s progress in distributing moneys pursuant to this part.

(4) Provide advice and guidance more broadly on statewide homelessness issues.

SEC. 63.

Section 5849.3 is added to the Welfare and Institutions Code, to read:

5849.3.
(a) There is hereby established the No Place Like Home Program Advisory Committee. Membership on the committee shall be as follows:
(1) The Director of Housing and Community Development, or their designee, who shall serve as the chairperson of the committee.
(2) The Director of Health Care Services, or their designee, and an additional representative.
(3) The Secretary of Veterans Affairs or their designee.
(4) The Director of Social Services or their designee.
(5) The Treasurer or their designee.
(6) The Chair of the Behavioral Health Services Oversight and Accountability Commission or their designee.
(7) A chief administrative officer of a small county or a member of a county board of supervisors of a small county, as provided by subdivision (d) of Section 5849.6, to be appointed by the Governor.
(8) A chief administrative officer of a large county or a member of a county board of supervisors of a large county, as provided by subdivision (b) of Section 5849.6, to be appointed by the Governor.
(9) A director of a county behavioral health department, to be appointed by the Governor.
(10) An administrative officer of a city, to be appointed by the Governor.
(11) A representative of an affordable housing organization, to be appointed by the Speaker of the Assembly.
(12) A resident of supportive housing, to be appointed by the Governor.
(13) A representative of a community behavioral health organization, to be appointed by the Senate Committee on Rules.
(14) A representative of a local or regional continuum of care organization that coordinates homelessness funding, to be appointed by the Governor.
(b) The committee shall do all of the following:
(1) Assist and advise the department in the implementation of the program.
(2) Review and make recommendations on the department’s guidelines.
(3) Review the department’s progress in distributing moneys pursuant to this part.
(4) Provide advice and guidance more broadly on statewide homelessness issues.
(c) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 64.

Section 5852.5 of the Welfare and Institutions Code is amended to read:

5852.5.

The State Department of Health Care Services, in consultation with the Mental Health Services Oversight and Accountability Commission shall review those counties that have been awarded funds to implement a comprehensive system for the delivery of mental health services to children with serious emotional disturbance and to their families or foster families to determine compliance with either of the following:

(a) The total estimated cost avoidance in all of the following categories shall equal or exceed the applications for funding award moneys:

(1) Group home costs paid by Aid to Families with Dependent Children-Foster Care (AFDC-FC) program.

(2) Children and adolescent state hospital and acute inpatient programs.

(3) Nonpublic school residential placement costs.

(4) Juvenile justice reincarcerations.

(5) Other short- and long-term savings in public funds resulting from the applications for funding award moneys.

(b) If the department determines that the total cost avoidance listed in subdivision (a) does not equal or exceed applications for funding award amounts, the department shall determine that the county that has been awarded funding shall achieve substantial compliance with all of the following goals:

(1) Total cost avoidance in the categories listed in subdivision (a) to exceed 50 percent of the applications for funding award moneys.

(2) A 20-percent reduction in out-of-county ordered placements of juvenile justice wards and social service dependents.

(3) A statistically significant reduction in the rate of recidivism by juvenile offenders.

(4) A 25-percent reduction in the rate of state hospitalization of minors from placements of special education pupils.

(5) A 10-percent reduction in out-of-county nonpublic school residential placements of special education pupils.

(6) Allow at least 50 percent of children at risk of imminent placement served by the intensive in-home crisis treatment programs, which are wholly or partially funded by applications for funding award moneys, to remain at home at least six months.

(7) Statistically significant improvement in school attendance and academic performance of seriously emotionally disturbed special education pupils treated in day treatment programs which are wholly or partially funded by applications for funding award moneys.

(8) Statistically significant increases in services provided in nonclinic settings among agencies.

(9) Increase in ethnic minority and gender access to services proportionate to the percentage of these groups in the county’s school-age population.

SEC. 65.

Section 5852.5 is added to the Welfare and Institutions Code, to read:

5852.5.
The State Department of Health Care Services, in consultation with the Behavioral Health Services Oversight and Accountability Commission, shall review those counties that have been awarded funds to implement a comprehensive system for the delivery of mental health and substance use disorder treatment services to children with a serious emotional disturbance and to their families or foster families to determine compliance with either of the following:
(a) The total estimated cost avoidance in all of the following categories shall equal or exceed the applications for funding award moneys:
(1) Group home costs paid by Aid to Families with Dependent Children-Foster Care (AFDC-FC) program.
(2) Children and adolescent state hospital and acute inpatient programs.
(3) Nonpublic school residential placement costs.
(4) Juvenile justice reincarcerations.
(5) Other short- and long-term savings in public funds resulting from the applications for funding award moneys.
(b) If the department determines that the total cost avoidance listed in subdivision (a) does not equal or exceed applications for funding award amounts, the department shall determine that the county that has been awarded funding shall achieve substantial compliance with all of the following goals:
(1) Total cost avoidance in the categories listed in subdivision (a) to exceed 50 percent of the applications for funding award moneys.
(2) A 20-percent reduction in out-of-county ordered placements of juvenile justice wards and social service dependents.
(3) A statistically significant reduction in the rate of recidivism by juvenile offenders.
(4) A 25-percent reduction in the rate of state hospitalization of minors from placements of special education pupils.
(5) A 10-percent reduction in out-of-county nonpublic school residential placements of special education pupils.
(6) Allow at least 50 percent of children at risk of imminent placement served by the intensive in-home crisis treatment programs, which are wholly or partially funded by applications for funding award moneys, to remain at home at least six months.
(7) Statistically significant improvement in school attendance and academic performance of seriously emotionally disturbed special education pupils treated in day treatment programs that are wholly or partially funded by applications for funding award moneys.
(8) Statistically significant increases in services provided in nonclinic settings among agencies.
(9) Increase in ethnic minority and gender access to services proportionate to the percentage of these groups in the county’s school-age population.
(c) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 66.

Section 5868 of the Welfare and Institutions Code is amended to read:

5868.

(a) The State Department of Health Care Services shall establish service standards that ensure that children in the target population are identified and receive needed and appropriate services from qualified staff in the least restrictive environment.

(b) The standards shall include, but not be limited to:

(1) Providing a comprehensive assessment and treatment plan for each target population client to be served, and developing programs and services that will meet their needs and facilitate client outcome goals.

(2) Providing for full participation of the family in all aspects of assessment, case planning, and treatment.

(3) Providing methods of assessment and services to meet the cultural, linguistic, and special needs of minorities in the target population.

(4) Providing for staff with the cultural background and linguistic skills necessary to remove barriers to mental health services resulting from a limited ability to speak English or from cultural differences.

(5) Providing mental health case management for all target population clients in, or being considered for, out-of-home placement.

(6) Providing mental health services in the natural environment of the child to the extent feasible and appropriate.

(1) A comprehensive mental health assessment.

(2) Case planning with all appropriate interagency participation.

(3) Linkage with all appropriate mental health services.

(4) Service plan monitoring.

(5) Client advocacy to ensure the provision of needed services.

(d) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 67.

Section 5868 is added to the Welfare and Institutions Code, to read:

5868.
(a) (1) The State Department of Health Care Services shall establish service requirements that ensure that children and youth in the target population are identified and receive needed and appropriate services from a qualified workforce in the least restrictive and natural environment to correct or ameliorate their behavioral health condition.
(2) The department shall provide annual oversight to this part for compliance with these requirements.
(b) These requirements shall include, but are not limited to, all of the following:
(1) Determination of the numbers of clients to be served and the programs and services that will be provided to meet their needs.
(2) The local director of behavioral health shall consult with the sheriff, the police chief, the probation officer, the chief of emergency medical services, the behavioral health board, Medi-Cal managed care plans, as defined in subdivision (j) of Section 14184.101, child welfare departments, contract providers and agencies, and family, client, ethnic, and citizen constituency groups as determined by the director.
(3) (A) Outreach to families with a child or youth with a serious emotional disturbance or a substance use disorder to provide coordination and access to behavioral health services, medications, housing interventions pursuant to Section 5830, and supportive services as defined in subdivision (g) of Section 5887.
(B) Service planning shall include evaluation strategies that shall consider cultural, linguistic, gender, age, and special needs of the target populations.
(C) Provision shall be made for a workforce with the cultural background and linguistic skills necessary to remove barriers to mental health and substance use disorder treatment services due to limited-English-speaking ability and cultural differences.
(D) Recipients of outreach services may include families, the public, primary care physicians, hospitals inclusive of emergency departments, behavioral health urgent care, and others who are likely to come into contact with individuals who may be suffering from either an untreated serious emotional disturbance or substance use disorder, or both, who would likely become homeless or incarcerated if the illness continued to be untreated for a substantial period of time.
(4) Provision for services for populations with identified disparities in behavioral health outcomes.
(5) Provision for full participation of the family in all aspects of assessment, service planning, and treatment, including, but not limited to, family support and consultation services, parenting support and consultation services, and peer support or self-help group support, where appropriate for the individual.
(6) Provision for clients who have been suffering from an untreated serious emotional disturbance or substance use disorder, or both, for less than one year and who do not require the full range of services but are at risk of becoming homeless or justice involved unless a comprehensive individual and family support services plan is implemented. These clients shall be served in a manner that is designed to meet their needs, including housing for clients that is immediate, transitional, permanent, or all of these.
(7) Provision for services to be client-directed, to use psychosocial rehabilitation and recovery principles, and to be integrated with other services.
(8) Provision for psychiatric and psychological collaboration in overall service planning.
(9) Provision for services specifically directed to children and youth experiencing first episode psychosis.
(10) Provision for services for frequent users of behavioral health urgent care, crisis stabilization units, and hospitals or emergency departments as the primary resource for mental health and substance use disorder treatment.
(11) Provision for services to meet the special needs of clients who are physically disabled, clients who are intellectually or developmentally disabled, or persons of American Indian or Alaska Native descent.
(c) (1) Each child or youth shall have a clearly designated personal services coordinator or case manager who may be part of a multidisciplinary treatment team.
(2) The personal services coordinator or case manager shall be responsible for providing or assuring that the child or youth receives needed behavioral health services and supportive services for individuals enrolled in full-service partnerships pursuant to Section 5887.
(d) The responsibility of the personal services coordinator or case managers shall be to ensure that each child or youth receives the following:
(1) A comprehensive mental health and substance use disorder assessment, including trauma screening.
(2) (A) Service planning with all appropriate interagency participation and developing programs and services that will meet their needs and facilitate achievement of the outcome goals.
(B) A client shall participate in the service planning process, and responsible staff shall consult with the designated conservator, if one has been appointed, and, with the consent of the client, consult with the family and other significant persons, as appropriate.
(3) Linkage with all appropriate mental health and substance use disorder treatment services and supportive services for each child or youth enrolled in full-service partnerships pursuant to Section 5887.
(4) Monitoring of the quality and followthrough of services provided.
(5) Advocacy to ensure the provision of needed behavioral health services identified during the service planning process.
(6) Behavioral health case management for target population clients in, or being considered for, out-of-home placement.
(7) A smooth transition from children and youth behavioral health programs, services, and supports to adult behavioral health programs, services, and supports.
(8) Trauma-informed behavioral health services to reduce trauma and avoid retraumatization.
(e) The service planning process shall ensure children and youth receive age-appropriate, gender-appropriate, and culturally appropriate services or appropriate services based on a characteristic listed or defined in Section 11135 of the Government Code, to the extent feasible, that are designed to enable recipients to:
(1) (A) Live in the most independent, least restrictive housing feasible in the local community and to live in a supportive housing environment that strives for family reunification.
(B) Rejoin or return to a home they had previously maintained with a family member or in shared housing environment that is supportive of their recovery and stabilization.
(2) Engage in the highest level of educational or productive activity appropriate to their age, abilities, and experience.
(3) Create and maintain a support system consisting of friends, family, and participation in community activities.
(4) Access necessary physical health care and maintain the best possible physical health.
(5) Reduce or eliminate serious antisocial or criminal behavior and thereby reduce or eliminate their contact with the criminal justice system.
(6) Reduce or eliminate the distress caused by the symptoms of either mental illness or substance use disorder, or both.
(7) Utilize trauma-informed approaches to reduce trauma and avoid retraumatization.
(f) (1) (A) The client’s clinical record shall describe the service array that meets the requirements of subdivisions (c) and (d) and, to the extent applicable to the individual, the requirements of subdivision (a) and (b).
(B) The State Department of Health Care Services may develop and revise documentation standards for service planning to be consistent with the standards developed pursuant to paragraph (3) of subdivision (h) of Section 14184.402.
(2) Documentation of the service planning process in the client’s clinical record pursuant to paragraph (1) may fulfill the documentation requirements for both the Medi-Cal program and this section.
(g) For purposes of this section, “behavioral health services” shall have the meaning as defined in Section 5892.
(h) For purposes of this section, “substance use disorder” shall have the meaning as defined in subdivision (c) of Section 5891.5.
(i) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 68.

Section 5878.1 of the Welfare and Institutions Code is amended to read:

5878.1.

(a) It is the intent of this article to establish programs that ensure services will be provided to severely mentally ill children as defined in Section 5878.2 and that they be part of the children’s system of care established pursuant to this part. It is the intent of this act that services provided under this chapter to severely mentally ill children are accountable, developed in partnership with youth and their families, culturally competent, and individualized to the strengths and needs of each child and ~~his or her~~ their family.

(b) Nothing in this act shall be construed to authorize any services to be provided to a minor without the consent of the child’s parent or legal guardian beyond those already authorized by existing statute.

SEC. 69.

Section 5878.1 is added to the Welfare and Institutions Code, to read:

5878.1.
(a) It is the intent of this article to establish programs that ensure services will be provided to children and youth with a serious emotional disturbance, as defined in Section 5878.2, and to children and youth with a substance use disorder, as defined in Section 5891.5, and that they be part of the children and youth system of care established pursuant to this part.
(b) It is the intent of this act that services provided under this chapter are accountable, developed in partnership with youth and their families and child welfare agencies, are culturally competent, and individualized to the strengths and needs of each child and their family.
(c) Nothing in this act shall be construed to authorize a service to be provided to a minor without the consent of the child’s parent or legal guardian beyond those already authorized by existing statute.
(d) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 70.

Section 5878.2 of the Welfare and Institutions Code is amended to read:

5878.2.

For purposes of this article, ~~severely mentally ill children~~ “children with a serious emotional disturbance” means minors under ~~the age of~~ 18 years of age who meet the criteria set forth in subdivision (a) of Section 5600.3.

SEC. 71.

Section 5878.3 of the Welfare and Institutions Code is amended to read:

5878.3.

(a) Subject to the availability of funds as determined pursuant to Part 4.5 (commencing with Section 5890) of this division, county mental health programs shall offer services to severely mentally ill children for whom services under any other public or private insurance or other mental health or entitlement program is inadequate or unavailable. Other entitlement programs include but are not limited to mental health services available pursuant to Medi-Cal, child welfare, and special education programs. The funding shall cover only those portions of care that cannot be paid for with public or private insurance, other mental health funds or other entitlement programs.

(b) Funding shall be at sufficient levels to ensure that counties can provide each child served all of the necessary services set forth in the applicable treatment plan developed in accordance with this part, including services where appropriate and necessary to prevent an out of home placement, such as services pursuant to Chapter 4 (commencing with Section 18250) of Part 6 of Division 9.

(c) The State Department of Health Care Services shall contract with county mental health programs for the provision of services under this article in the manner set forth in Section 5897.

SEC. 72.

Section 5878.3 is added to the Welfare and Institutions Code, to read:

5878.3.
(a) (1) (A) Subject to the availability of funds, as determined pursuant to Part 4.5 (commencing with Section 5890), county behavioral health programs shall offer services to children and youth with a serious emotional disturbance, as defined in Section 5878.2, and children and youth with a substance use disorder, as defined in Section 5891.5, for whom services under other public or private insurance or other mental health, substance use disorder, or other entitlement program is inadequate or unavailable.
(B) Other entitlement programs include, but are not limited to, mental health and substance use disorder treatment services available pursuant to Medi-Cal, child welfare, and special education programs.
(C) The funding shall cover only those portions of care that cannot be paid for with public or private insurance, other mental health and substance use disorder funds, or other entitlement programs.
(2) To maximize federal financial participation in furtherance of subdivision (d) of Section 5890, a county shall submit claims for reimbursement to the State Department of Health Care Services in accordance with applicable Medi-Cal rules and procedures for a behavioral health service or supportive service eligible for reimbursement pursuant to Title XIX or XXI of the federal Social Security Act (42 U.S.C. Sec. 1396, et seq. and 1397aa, et seq.) when such service is paid, in whole or in part, using funds from the Behavioral Health Services Fund established pursuant to Section 5890.
(3) (A) To maximize funding from other sources, a county shall seek reimbursement for a behavioral health service, supportive service, housing intervention, prevention service, or other related activity provided pursuant to subdivision (a) of Section 5892 that is covered by, or can be paid from, another available funding source, including other mental health funds, substance use disorder funds, public and private insurance, and other local, state, and federal funds.
(B) A county shall make a good faith effort to contract with health care service plans and disability insurance plans, pursuant to Section 1374.72 of the Health and Safety Code and Section 10144.5 of the Insurance Code, as an in-network provider.
(C) A county shall also submit requests for prior authorization for services, request letters of agreement for payment as an out-of-network provider, and pursue other means to obtain reimbursement in accordance with state and federal laws.
(4) (A) A county may report to the Department of Managed Health Care or the Department of Insurance, as appropriate, complaints about a health plan’s or a health insurer’s failure to work in good faith with the county, to contract with the county, or to be an in-network provider of the health plan or insurer.
(B) A county may also report to the Department of Managed Health Care or the Department of Insurance, respectively, a failure by a health plan or insurer to timely reimburse the county for services the plan or insurer must cover as required by state or federal law, including, but not limited to, Sections 1374.72 and 1374.721 of the Health and Safety Code and Sections 10144.5 and 10144.52 of the Insurance Code.
(C) Upon receipt of a complaint from a county, the Department of Managed Health Care or the Department of Insurance, as applicable, shall timely investigate the complaint.
(b) (1) Funding shall be at sufficient levels to ensure counties can provide each child served all of the services determined to be necessary during the service planning process in accordance with this part, including services where appropriate and necessary to prevent an out of home placement, such as services pursuant to Chapter 4 (commencing with Section 18250) of Part 6 of Division 9.
(2) A county may use this funding to provide services to address first episode psychosis.
(c) The State Department of Health Care Services shall contract with county behavioral health programs for the provision of services under this article in the manner set forth in Section 5897.
(d) For purposes of this section, “supportive services” shall have the meaning as defined in subdivision (g) of Section 5887.
(e) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 73.

Section 5881 of the Welfare and Institutions Code is amended to read:

5881.

(a) Evaluation shall be conducted by participating county evaluation staff and, subject to the availability of funds, by the State Department of Health Care Services and the Mental Health Services Oversight and Accountability Commission.

(b) Evaluation at both levels shall do all of the following:

(1) Ensure that county level systems of care are serving the targeted population.

(2) Ensure that the timely performance data related to client outcome and cost avoidance is collected, analyzed, and reported.

(3) Ensure that system of care components are implemented as intended.

(4) Provide information documenting needs for future planning.

SEC. 74.

Section 5881 is added to the Welfare and Institutions Code, to read:

5881.
(a) Evaluation shall be conducted by participating county evaluation staff and, subject to the availability of funds, by the State Department of Health Care Services and the Behavioral Health Services Oversight and Accountability Commission.
(b) Evaluation at both levels shall do all of the following:
(1) Ensure county level systems of care are serving the targeted population.
(2) Ensure the timely performance data related to client outcome and cost avoidance is collected, analyzed, and reported.
(3) Ensure system of care components are implemented as intended.
(4) Provide information documenting needs for future planning.
(c) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 75.

Section 5886 of the Welfare and Institutions Code is amended to read:

5886.

(a) The Mental Health Student Services Act is hereby established as a mental health partnership grant program for the purpose of establishing mental health partnerships between a county’s mental health or behavioral health departments and school districts, charter schools, and the county office of education within the county.

(b) The Mental Health Services Oversight and Accountability Commission shall award grants to county mental health or behavioral health departments to fund partnerships between educational and county mental health entities. Subject to an appropriation for this purpose, commencing with the 2021–22 fiscal year, the commission shall award a grant under this section to a county mental health or behavioral health department or another lead agency, as identified by the partnership within each county that meets the requirements of this section.

(1) County, city, or multicounty mental health or behavioral health departments, or a consortium of those entities, including multicounty partnerships, may, in partnership with one or more school districts and at least one of the following educational entities located within the county, apply for a grant to fund activities of the partnership:

(A) The county office of education.

(B) A charter school.

(2) An educational entity may be designated as the lead agency at the request of the county, city, or multicounty department, or consortium, and authorized to submit the application. The county, city, or multicounty department, or consortium, shall be the grantee and receive any grant funds awarded pursuant to this section even if an educational entity is designated as the lead agency and submits the application pursuant to this paragraph.

(c) The commission shall establish criteria for awarding funds under the grant program, including the allocation of grant funds pursuant to this section, and shall require that applicants comply with, at a minimum, all of the following requirements:

(1) That all school districts, charter schools, and the county office of education have been invited to participate in the partnership, to the extent possible.

(2) That applicants include with their application a plan developed and approved in collaboration with participating educational entity partners and that include a letter of intent, a memorandum of understanding, or other evidence of support or approval by the governing boards of all partners.

(3) That plans address all of the following goals:

(A) Preventing mental illnesses from becoming severe and disabling.

(B) Improving timely access to services for underserved populations.

(C) Providing outreach to families, employers, primary care health care providers, and others to recognize the early signs of potentially severe and disabling mental illnesses.

(D) Reducing the stigma associated with the diagnosis of a mental illness or seeking mental health services.

(E) Reducing discrimination against people with mental illness.

(F) Preventing negative outcomes in the targeted population, including, but not limited to:

(i) Suicide and attempted suicide.

(ii) Incarceration.

(iii) School failure or dropout.

(iv) Unemployment.

(v) Prolonged suffering.

(vi) Homelessness.

(vii) Removal of children from their homes.

(viii) Involuntary mental health detentions.

(4) That the plan includes a description of the following:

(A) The need for mental health services for children and youth, including campus-based mental health services, as well as potential gaps in local service connections.

(B) The proposed use of funds, which shall include, at a minimum, that funds will be used to provide personnel or peer support.

(C) How the funds will be used to facilitate linkage and access to ongoing and sustained services, including, but not limited to, objectives and anticipated outcomes.

(D) How the partnership will collaborate with preschool and childcare providers, or other early childhood service organizations, to ensure the mental health needs of children are met before and after they transition to a school setting.

(E) The partnership’s ability to do all of the following:

(i) Obtain federal Medicaid or other reimbursement, including Early and Periodic Screening, Diagnostic, and Treatment funds, when applicable, or to leverage other funds, when feasible.

(ii) Collect information on the health insurance carrier for each child or youth, with the permission of the child or youth’s parent, to allow the partnership to seek reimbursement for mental health services provided to children and youth, where applicable.

(iii) Engage a health care service plan or a health insurer in the mental health partnership, when applicable, and to the extent mutually agreed to by the partnership and the plan or insurer.

(iv) Administer an effective service program and the degree to which mental health providers and educational entities will support and collaborate to accomplish the goals of the effort.

(v) Connect children and youth to a source of ongoing mental health services, including, but not limited to, through Medi-Cal, specialty mental health plans, county mental health programs, or private health coverage.

(vi) Continue to provide services and activities under this program after grant funding has been expended.

(d) Grants awarded pursuant to this section shall be used to provide support services that include, at a minimum, all of the following:

(1) Services provided on school campuses, to the extent practicable.

(2) Suicide prevention services.

(3) Drop-out prevention services.

(4) Outreach to high-risk youth and young adults, including, but not limited to, foster youth, youth who identify as lesbian, gay, bisexual, transgender, or queer, and youth who have been expelled or suspended from school.

(5) Placement assistance and development of a service plan that can be sustained over time for students in need of ongoing services.

(e) Funding may also be used to provide other prevention, early intervention, and direct services, including, but not limited to, hiring qualified mental health personnel, professional development for school staff on trauma-informed and evidence-based mental health practices, and other strategies that respond to the mental health needs of children and youth, as determined by the commission.

(f) The commission shall determine the amount of grants and shall take into consideration the level of need and the number of schoolage youth in participating educational entities when determining grant amounts. In determining the distribution of funds appropriated in the 2021–22 fiscal year, the commission shall take into consideration any previous funding the grantee received under this section.

(g) The commission may establish incentives to provide matching funds by awarding additional grant funds to partnerships that do so.

(h) If the commission is unable to provide a grant to a partnership in a county because of a lack of applicants or because no applicants met the minimum requirements within the timeframes established by the commission, the commission may redistribute those funds to other eligible grantees.

(i) Partnerships currently receiving grants from the Investment in Mental Health Wellness Act of 2013 (Part 3.8 (commencing with Section 5848.5)) are eligible to receive a grant under this section for the expansion of services funded by that grant or for the inclusion of additional educational entity partners within the mental health partnership.

(j) Grants awarded pursuant to this section may be used to supplement, but not supplant, existing financial and resource commitments of the county, city, or multi-county mental health or behavioral health departments, or a consortium of those entities, or educational entities that receive a grant.

(k) (1) The commission shall develop metrics and a system to measure and publicly report on the performance outcomes of services provided using the grants.

(2) (A) The commission shall provide a status report to the fiscal and policy committees of the Legislature on the progress of implementation of this section no later than March 1, 2022, and provide an updated report no later than March 1, 2024. The reports shall address, at a minimum, all of the following:

(i) Successful strategies.

(ii) Identified needs for additional services.

(iii) Lessons learned.

(iv) Numbers of, and demographic information for, the schoolage children and youth served.

(v) Available data on outcomes, including, but not limited to, linkages to ongoing services and success in meeting the goals identified in paragraph (3) of subdivision (c).

(B) The reports to be submitted pursuant to this paragraph shall be submitted in compliance with Section 9795 of the Government Code.

(l) This section does not require the use of funds allocated for the purpose of satisfying the minimum funding obligation under Section 8 of Article XVI of the California Constitution for the partnerships established by this section.

(m) The commission may enter into exclusive or nonexclusive contracts, or amend existing contracts, on a bid or negotiated basis in order to implement this section. Contracts entered into or amended pursuant to this subdivision are exempt from Chapter 6 (commencing with Section 14825) of Part 5.5 of Division 3 of Title 2 of the Government Code, Section 19130 of the Government Code, and Part 2 (commencing with Section 10100) of Division 2 of the Public Contract Code, and shall be exempt from the review or approval of any division of the Department of General Services.

(n) This section shall be implemented only to the extent moneys are appropriated in the annual Budget Act or another statute for purposes of this section.

(o) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 76.

Section 5886 is added to the Welfare and Institutions Code, to read:

5886.
(a) The Behavioral Health Student Services Act is hereby established as a mental health partnership grant program for the purpose of establishing mental health partnerships between a county’s mental health or behavioral health departments and school districts, charter schools, and the county office of education within the county.
(b) The Behavioral Health Services Oversight and Accountability Commission shall award grants to county mental health or behavioral health departments to fund partnerships between educational and county mental health entities. Subject to an appropriation for this purpose, commencing with the 2021–22 fiscal year, the commission shall award a grant under this section to a county mental health or behavioral health department, or another lead agency, as identified by the partnership within each county that meets the requirements of this section.
(1) County, city, or multicounty mental health or behavioral health departments, or a consortium of those entities, including multicounty partnerships, may, in partnership with one or more school districts and at least one of the following educational entities located within the county, apply for a grant to fund activities of the partnership:
(A) The county office of education.
(B) A charter school.
(2) (A) An educational entity may be designated as the lead agency at the request of the county, city, or multicounty department, or consortium, and authorized to submit the application.
(B) The county, city, or multicounty department, or consortium, shall be the grantee and receive grant funds awarded pursuant to this section, even if an educational entity is designated as the lead agency and submits the application pursuant to this paragraph.
(c) The commission shall establish criteria for awarding funds under the grant program, including the allocation of grant funds pursuant to this section, and shall require that applicants comply with, at a minimum, all of the following requirements:
(1) That all school districts, charter schools, and the county office of education have been invited to participate in the partnership, to the extent possible.
(2) That applicants include with their application a plan developed and approved in collaboration with participating educational entity partners and that include a letter of intent, a memorandum of understanding, or other evidence of support or approval by the governing boards of all partners.
(3) That plans address all of the following goals:
(A) Preventing mental illnesses from becoming severe and disabling.
(B) Improving timely access to services for underserved populations.
(C) Providing outreach to families, employers, primary care health care providers, and others to recognize the early signs of potentially severe and disabling mental illnesses.
(D) Reducing the stigma associated with the diagnosis of a mental illness or seeking mental health services.
(E) Reducing discrimination against people with mental illness.
(F) Preventing negative outcomes in the targeted population, including, but not limited to, all of the following:
(i) Suicide and attempted suicide.
(ii) Incarceration.
(iii) School failure or dropout.
(iv) Unemployment.
(v) Prolonged suffering.
(vi) Homelessness.
(vii) Removal of children from their homes.
(viii) Involuntary mental health detentions.
(4) That plans include a description of the following:
(A) The need for mental health services for children and youth, including campus-based mental health services and potential gaps in local service connections.
(B) The proposed use of funds, which shall include, at a minimum, that funds will be used to provide personnel or peer support.
(C) How the funds will be used to facilitate linkage and access to ongoing and sustained services, including, but not limited to, objectives and anticipated outcomes.
(D) How the partnership will collaborate with preschool and childcare providers, or other early childhood service organizations, to ensure the mental health needs of children are met before and after they transition to a school setting.
(E) The partnership’s ability to do all of the following:
(i) Obtain federal Medicaid or other reimbursement, including Early and Periodic Screening, Diagnostic, and Treatment funds, when applicable, or to leverage other funds, when feasible.
(ii) Collect information on the health insurance carrier for each child or youth, with the permission of the child or youth’s parent, to allow the partnership to seek reimbursement for mental health services provided to children and youth, where applicable.
(iii) Engage a health care service plan or a health insurer in the mental health partnership, when applicable, and to the extent mutually agreed to by the partnership and the plan or insurer.
(iv) Administer an effective service program and the degree to which mental health providers and educational entities will support and collaborate to accomplish the goals of the effort.
(v) Connect children and youth to a source of ongoing mental health services, including, but not limited to, through Medi-Cal, specialty mental health plans, county mental health programs, or private health coverage.
(vi) Continue to provide services and activities under this program after grant funding has been expended.
(d) Grants awarded pursuant to this section shall be used to provide support services that include, at a minimum, all of the following:
(1) Services provided on school campuses, to the extent practicable.
(2) Suicide prevention services.
(3) Drop-out prevention services.
(4) Outreach to high-risk youth and young adults, including, but not limited to, foster youth, youth who identify as LGBTQ+, victims of domestic violence and sexual abuse, and youth who have been expelled or suspended from school.
(5) Placement assistance and development of a service plan that can be sustained over time for students in need of ongoing services.
(e) Funding may also be used to provide other prevention, early intervention, and direct services, including, but not limited to, hiring qualified mental health personnel, professional development for school staff on trauma-informed and evidence-based mental health practices, and other strategies that respond to the mental health needs of children and youth, as determined by the commission.
(f) (1) The commission shall determine the amount of grants and shall take into consideration the level of need and the number of school-age youth in participating educational entities when determining grant amounts.
(2) In determining the distribution of funds appropriated in the 2021–22 fiscal year, the commission shall take into consideration previous funding the grantee received under this section.
(g) The commission may establish incentives to provide matching funds by awarding additional grant funds to partnerships that do so.
(h) If the commission is unable to provide a grant to a partnership in a county because of a lack of applicants or because no applicants met the minimum requirements within the timeframes established by the commission, the commission may redistribute those funds to other eligible grantees.
(i) Partnerships currently receiving grants from the Investment in Mental Health Wellness Act of 2013 (Part 3.8 (commencing with Section 5848.5)) are eligible to receive a grant under this section for the expansion of services funded by that grant or for the inclusion of additional educational entity partners within the mental health partnership.
(j) Grants awarded pursuant to this section may be used to supplement, but not supplant, existing financial and resource commitments of the county, city, or multi-county mental health or behavioral health departments, or a consortium of those entities, or educational entities that receive a grant.
(k) (1) The commission shall develop metrics and a system to measure and publicly report on the performance outcomes of services provided using the grants.
(2) (A) The commission shall provide a status report to the fiscal and policy committees of the Legislature on the progress of implementation of this section no later than March 1, 2022, and provide an updated report no later than March 1, 2024. The reports shall address, at a minimum, all of the following:
(i) Successful strategies.
(ii) Identified needs for additional services.
(iii) Lessons learned.
(iv) Numbers of, and demographic information for, the schoolage children and youth served.
(v) Available data on outcomes, including, but not limited to, linkages to ongoing services and success in meeting the goals identified in paragraph (3) of subdivision (c).
(B) The reports to be submitted pursuant to this paragraph shall be submitted in compliance with Section 9795 of the Government Code.
(l) This section does not require the use of funds allocated for the purpose of satisfying the minimum funding obligation under Section 8 of Article XVI of the California Constitution for the partnerships established by this section.
(m) The commission may enter into exclusive or nonexclusive contracts, or amend existing contracts, on a bid or negotiated basis to implement this section.
(n) This section shall be implemented only to the extent moneys are appropriated in the annual Budget Act or another statute for purposes of this section.
(o) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 77.

Part 4.1 (commencing with Section 5887) is added to Division 5 of the Welfare and Institutions Code, to read:

PART 4.1. Full-Service Partnership
5887.
(a) Full-service partnership programs shall include the following services:
(1) Behavioral health services, substance use disorder treatment services, as defined in Section 5891.5, and supportive services.
(2) Assertive Community Treatment and Forensic Assertive Community Treatment to fidelity and other evidence-based services and treatment models, as specified by the State Department of Health Care Services.
(3) All services identified during the service planning process pursuant to Sections 5806 and 5868.
(4) Housing interventions pursuant to Section 5830.
(b) (1) (A) Full-service partnership services shall be provided pursuant to a whole-person approach that is trauma informed and in partnership with families or an individual’s natural supports.
(B) These services shall be provided in a streamlined and coordinated manner so as to reduce any barriers to services.
(2) Full-service partnership services shall support the individual in the recovery process, reduce health disparities, and be provided for the length of time identified during the service planning process pursuant to Sections 5806 and 5868.
(c) Full-service partnership programs shall employ community-defined evidence programs, as specified by the State Department of Health Care Services.
(d) (1) Full-service partnership programs shall enroll adults and older adults who meet the priority population criteria specified in subdivision (c) of Section 5892 and other criteria, as specified by the State Department of Health Care Services.
(2) Full-service partnership programs shall enroll children and youth with a serious emotional disturbance, as defined in Section 5600.3, or a substance use disorder, as defined in Section 5891.5.
(e) Full-service partnership programs shall have an established standard of care with levels based on an individual’s acuity and criteria for step-down into the least intensive level of care, as specified by the State Department of Health Care Services.
(f) All behavioral health and substance use disorder treatment services, as defined in Section 5891.5, and supportive services provided to a client enrolled in a full-service partnership shall be paid from the funds allocated pursuant to Section 5892, subject to Section 5891.
(g) “Supportive services” means those services necessary to support clients’ recovery and wellness, including, but not limited to, food, clothing, linkages to needed social services, linkages to programs administered by the federal Social Security Administration, vocational and education-related services, employment assistance, family engagement, psychoeducation, transportation assistance, occupational therapy provided by an occupational therapist, and group and individual activities that promote a sense of purpose and community participation.
5887.1.
This part shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 78.

Section 5890 of the Welfare and Institutions Code is amended to read:

5890.

(a) The Mental Health Services Fund is hereby created in the State Treasury. The fund shall be administered by the state. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are, except as provided in subdivision (d) of Section 5892, continuously appropriated, without regard to fiscal years, for the purpose of funding the following programs and other related activities as designated by other provisions of this division:

(1) Part 3 (commencing with Section 5800), the Adult and Older Adult Mental Health System of Care Act.

(2) Part 3.2 (commencing with Section 5830), Innovative Programs.

(3) Part 3.6 (commencing with Section 5840), Prevention and Early Intervention Programs.

(4) Part 3.9 (commencing with Section 5849.1), No Place Like Home Program.

(5) Part 4 (commencing with Section 5850), the Children’s Mental Health Services Act.

(b) The establishment of this fund and any other provisions of the act establishing it or the programs funded shall not be construed to modify the obligation of health care service plans and disability insurance policies to provide coverage for mental health services, including those services required under Section 1374.72 of the Health and Safety Code and Section 10144.5 of the Insurance Code, related to mental health parity. This act shall not be construed to modify the oversight duties of the Department of Managed Health Care or the duties of the Department of Insurance with respect to enforcing these obligations of plans and insurance policies.

(c) This act shall not be construed to modify or reduce the existing authority or responsibility of the State Department of Health Care Services.

(d) The State Department of Health Care Services shall seek approval of all applicable federal Medicaid approvals to maximize the availability of federal funds and eligibility of participating children, adults, and seniors for medically necessary care.

(e) Share of costs for services pursuant to Part 3 (commencing with Section 5800) and Part 4 (commencing with Section 5850) of this division, shall be determined in accordance with the Uniform Method of Determining Ability to Pay applicable to other publicly funded mental health services, unless this Uniform Method is replaced by another method of determining copayments, in which case the new method applicable to other mental health services shall be applicable to services pursuant to Part 3 (commencing with Section 5800) and Part 4 (commencing with Section 5850) of this division.

(f) (1) The Supportive Housing Program Subaccount is hereby created in the Mental Health Services Fund. Notwithstanding Section 13340 of the Government Code, all moneys in the subaccount are reserved and continuously appropriated, without regard to fiscal years, to the California Health Facilities Financing Authority to provide funds to meet its financial obligations pursuant to any service contracts entered into pursuant to Section 5849.35. Notwithstanding any other law, including any other provision of this section, no later than the last day of each month, the Controller shall, before any transfer or expenditure from the fund for any other purpose for the following month, transfer from the Mental Health Services Fund to the Supportive Housing Program Subaccount an amount that has been certified by the California Health Facilities Financing Authority pursuant to paragraph (3) of subdivision (a) of Section 5849.35, but not to exceed an aggregate amount of one hundred forty million dollars ($140,000,000) per year. If in any month the amounts in the Mental Health Services Fund are insufficient to fully transfer to the subaccount or the amounts in the subaccount are insufficient to fully pay the amount certified by the California Health Facilities Financing Authority, the shortfall shall be carried over to the next month, to be transferred by the Controller with any transfer required by the preceding sentence. Moneys in the Supportive Housing Program Subaccount shall not be loaned to the General Fund pursuant to Section 16310 or 16381 of the Government Code.

(2) Prior to the issuance of any bonds pursuant to Section 15463 of the Government Code, the Legislature may appropriate for transfer funds in the Mental Health Services Fund to the Supportive Housing Program Subaccount in an amount up to one hundred forty million dollars ($140,000,000) per year. Any amount appropriated for transfer pursuant to this paragraph and deposited in the No Place Like Home Fund shall reduce the authorized but unissued amount of bonds that the California Health Facilities Financing Authority may issue pursuant to Section 15463 of the Government Code by a corresponding amount. Notwithstanding Section 13340 of the Government Code, all moneys in the subaccount transferred pursuant to this paragraph are reserved and continuously appropriated, without regard to fiscal years, for transfer to the No Place Like Home Fund, to be used for purposes of Part 3.9 (commencing with Section 5849.1). The Controller shall, before any transfer or expenditure from the fund for any other purpose for the following month but after any transfer from the fund for purposes of paragraph (1), transfer moneys appropriated from the Mental Health Services Fund to the subaccount pursuant to this paragraph in equal amounts over the following 12-month period, beginning no later than 90 days after the effective date of the appropriation by the Legislature. If in any month the amounts in the Mental Health Services Fund are insufficient to fully transfer to the subaccount or the amounts in the subaccount are insufficient to fully pay the amount appropriated for transfer pursuant to this paragraph, the shortfall shall be carried over to the next month.

(3) The sum of any transfers described in paragraphs (1) and (2) shall not exceed an aggregate of one hundred forty million dollars ($140,000,000) per year.

(4) Paragraph (2) shall become inoperative once any bonds authorized pursuant to Section 15463 of the Government Code are issued.

SEC. 79.

Section 5890 is added to the Welfare and Institutions Code, to read:

5890.
(a) (1) The Behavioral Health Services Fund is hereby created in the State Treasury.
(2) The fund shall be administered by the State Department of Health Care Services.
(3) Notwithstanding Section 13340 of the Government Code, all moneys in the fund are, except as provided in subdivision (d) of Section 5892, continuously appropriated, without regard to fiscal years, for the purpose of funding the programs, services, and other related activities as specified in Section 5892 and Part 3.9 (commencing with Section 5849.1), the No Place Like Home Program.
(b) (1) The establishment of this fund and other provisions of the act establishing it or the programs funded shall not be construed to modify the obligation of health care service plans and disability insurance policies to provide coverage for behavioral health services, including those services required under Section 1374.72 of the Health and Safety Code and Section 10144.5 of the Insurance Code, related to mental health and substance use disorder parity.
(2) This act does not modify the oversight duties of the Department of Managed Health Care or the duties of the Department of Insurance with respect to enforcing these obligations of plans and insurance policies.
(c) This act does not modify or reduce the existing authority or responsibility of the State Department of Health Care Services.
(d) The State Department of Health Care Services shall seek approval of all applicable federal Medicaid approvals to maximize the availability of federal funds and eligibility of participating children, adults, and older adults for medically necessary care.
(e) Share of costs for services pursuant to Part 3 (commencing with Section 5800) and Part 4 (commencing with Section 5850) shall be determined in accordance with the Uniform Method of Determining Ability to Pay applicable to other publicly funded mental health and substance use disorder treatment services, unless this uniform method is replaced by another method of determining copayments, in which case the new method applicable to other mental health and substance use disorder treatment services shall be applicable to services pursuant to Part 3 (commencing with Section 5800) and Part 4 (commencing with Section 5850).
(f) (1) (A) The Supportive Housing Program Subaccount is hereby created in the Behavioral Health Services Fund.
(B) Notwithstanding Section 13340 of the Government Code, all moneys in the subaccount are reserved and continuously appropriated, without regard to fiscal years, to the California Health Facilities Financing Authority to provide funds to meet its financial obligations pursuant to service contracts entered into pursuant to Section 5849.35.
(C) Notwithstanding any other law, including any other provision of this section, no later than the last day of each month, the Controller shall, before any transfer or expenditure from the fund for any other purpose for the following month, transfer from the Behavioral Health Services Fund to the Supportive Housing Program Subaccount an amount that has been certified by the California Health Facilities Financing Authority pursuant to paragraph (3) of subdivision (a) of Section 5849.35 but not to exceed an aggregate amount of one hundred forty million dollars ($140,000,000) per year.
(D) If, in any month, the amounts in the Behavioral Health Services Fund are insufficient to fully transfer to the subaccount or the amounts in the subaccount are insufficient to fully pay the amount certified by the California Health Facilities Financing Authority, the shortfall shall be carried over to the next month, to be transferred by the Controller with any transfer required by the preceding sentence.
(E) Moneys in the Supportive Housing Program Subaccount shall not be loaned to the General Fund pursuant to Section 16310 or 16381 of the Government Code.
(2) (A) Prior to the issuance of any bonds pursuant to Section 15463 of the Government Code, the Legislature may appropriate for transfer funds in the Behavioral Health Services Fund to the Supportive Housing Program Subaccount in an amount up to one hundred forty million dollars ($140,000,000) per year.
(B) Any amount appropriated for transfer pursuant to this paragraph and deposited in the No Place Like Home Fund shall reduce the authorized but unissued amount of bonds that the California Health Facilities Financing Authority may issue pursuant to Section 15463 of the Government Code by a corresponding amount.
(C) Notwithstanding Section 13340 of the Government Code, all moneys in the subaccount transferred pursuant to this paragraph are reserved and continuously appropriated, without regard to fiscal years, for transfer to the No Place Like Home Fund, to be used for purposes of Part 3.9 (commencing with Section 5849.1).
(D) The Controller shall, before any transfer or expenditure from the fund for any other purpose for the following month but after any transfer from the fund for purposes of paragraph (1), transfer moneys appropriated from the Behavioral Health Services Fund to the subaccount pursuant to this paragraph in equal amounts over the following 12-month period, beginning no later than 90 days after the effective date of the appropriation by the Legislature.
(E) If, in any month, the amounts in the Behavioral Health Services Fund are insufficient to fully transfer to the subaccount or the amounts in the subaccount are insufficient to fully pay the amount appropriated for transfer pursuant to this paragraph, the shortfall shall be carried over to the next month.
(3) The sum of any transfer described in paragraphs (1) and (2) shall not exceed an aggregate of one hundred forty million dollars ($140,000,000) per year.
(4) Paragraph (2) shall become inoperative once bonds authorized pursuant to Section 15463 of the Government Code are issued.
(g) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 80.

Section 5891 of the Welfare and Institutions Code is amended to read:

5891.

(a) (1) (A) The funding established pursuant to this act shall be utilized to expand mental health services. ~~Except~~

(B) Except as provided in subdivision (j) of Section 5892 due to the state’s fiscal crisis, these funds shall not be used to supplant existing state or county funds utilized to provide mental health services. ~~The~~

(C) The state shall continue to provide financial support for mental health programs with not less than the same entitlements, amounts of allocations from the General Fund or from the Local Revenue Fund 2011 in the State Treasury, and formula distributions of dedicated funds as provided in the last fiscal year which ended prior to the effective date of this act. ~~The~~

(D) The state shall not make any change to the structure of financing mental health services, which increases a county’s share of costs or financial risk for mental health services unless the state includes adequate funding to fully compensate for such increased costs or financial risk. ~~These~~

(E) These funds shall only be used to pay for the programs authorized in Sections 5890 and 5892. These funds may not be used to pay for any other program. ~~These~~

(F) These funds may not be loaned to the General Fund or any other fund of the state, or a county general fund or any other county fund for any purpose other than those authorized by Sections 5890 and 5892.

(2) To maximize federal financial participation in furtherance of subdivision (d) of Section 5890, a county shall submit claims for reimbursement to the State Department of Health Care Services in accordance with applicable Medi-Cal rules and procedures for a behavioral health service or supportive service eligible for reimbursement pursuant to Title XIX or XXI of the federal Social Security Act (42 U.S.C. Sec. 1396, et seq. and 1397aa, et seq.) when such service is paid, in whole or in part, using the funding established pursuant to this act.
(3) (A) To maximize funding from other sources, a county shall seek reimbursement for a behavioral health service, supportive service, housing intervention, prevention service, or other related activity provided, pursuant to subdivision (a) of Section 5892, that is covered by or can be paid from another available funding source, including other mental health funds, substance use disorder funds, public and private insurance, and other local, state, and federal funds.
(B) A county shall make a good faith effort to contract with health care service plans and disability insurance plans, pursuant to Section 1374.72 of the Health and Safety Code and Section 10144.5 of the Insurance Code, as an in-network provider.
(C) A county shall also submit requests for prior authorization for services, request letters of agreement for payment as an out-of-network provider, and pursue other means to obtain reimbursement in accordance with state and federal laws.

(b) (1) Notwithstanding subdivision (a), and except as provided in paragraph (2), the Controller may use the funds created pursuant to this part for loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code. Any such loan shall be repaid from the General Fund with interest computed at 110 percent of the Pooled Money Investment Account rate, with interest commencing to accrue on the date the loan is made from the fund. This subdivision does not authorize any transfer that would interfere with the carrying out of the object for which these funds were created.

(2) This subdivision does not apply to the Supportive Housing Program Subaccount created by subdivision (f) of Section 5890 or any moneys paid by the California Health Facilities Financing Authority to the Department of Housing and Community Development as a service fee pursuant to a service contract authorized by Section 5849.35.

(c) Commencing July 1, 2012, on or before the 15th day of each month, pursuant to a methodology provided by the State Department of Health Care Services, the Controller shall distribute to each Local Mental Health Service Fund established by counties pursuant to subdivision (f) of Section 5892, all unexpended and unreserved funds on deposit as of the last day of the prior month in the Mental Health Services Fund, established pursuant to Section 5890, for the provision of programs and other related activities set forth in Part 3 (commencing with Section 5800), Part 3.2 (commencing with Section 5830), Part 3.6 (commencing with Section 5840), Part 3.9 (commencing with Section 5849.1), and Part 4 (commencing with Section 5850).

(d) (1) Counties shall base their expenditures on the county mental health program’s three-year program and expenditure plan or annual update, as required by Section 5847. ~~Nothing in this subdivision shall affect~~

(2) This subdivision does not affect subdivision (a) or (b).

(e) This section shall become operative immediately if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.
(f) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on July 1, 2026, and as of January 1, 2027, is repealed.

SEC. 81.

Section 5891 is added to the Welfare and Institutions Code, to read:

5891.
(a) (1) (A) The funding established pursuant to this act shall be utilized by counties to expand mental health and substance use disorder treatment services.
(B) Except as provided in subdivision (j) of Section 5892, due to the state’s fiscal crisis, these funds shall not be used to supplant existing state or county funds utilized to provide mental health services.
(C) The state shall continue to provide financial support for mental health and substance use disorder programs with not less than the same entitlements, amounts of allocations from the General Fund or from the Local Revenue Fund 2011 in the State Treasury, and formula distributions of dedicated funds as provided in the last fiscal year which ended prior to the effective date of this act.
(D) The state shall not make a change to the structure of financing mental health and substance use disorder treatment services that increases a county’s share of costs or financial risk for behavioral health services unless the state includes adequate funding to fully compensate for such increased costs or financial risk.
(E) These funds shall only be used to pay for the programs authorized in Sections 5890 and 5892.
(F) These funds may not be used to pay for another program.
(G) These funds may not be loaned to the General Fund or another fund of the state, a county general fund, or another county fund for any purpose other than those authorized by Sections 5890 and 5892.
(2) To maximize federal financial participation in furtherance of subdivision (d) of Section 5890, a county shall submit claims for reimbursement to the State Department of Health Care Services in accordance with applicable Medi-Cal rules and procedures for a behavioral health service or supportive service eligible for reimbursement pursuant to Title XIX or XXI of the federal Social Security Act (42 U.S.C. Sec. 1396, et seq. and 1397aa, et seq.) when such service is paid, in whole or in part, using the funding established pursuant to this act.
(3) (A) To maximize funding from other sources, a county shall seek reimbursement for a behavioral health service, supportive service, housing intervention, prevention service, or other related activity provided, pursuant to subdivision (a) of Section 5892, that is covered by or can be paid from another available funding source, including other mental health funds, substance use disorder funds, public and private insurance, and other local, state, and federal funds.
(B) A county shall make a good faith effort to contract with health care service plans and disability insurance plans, pursuant to Section 1374.72 of the Health and Safety Code and Section 10144.5 of the Insurance Code, as an in-network provider.
(C) A county shall also submit requests for prior authorization for services, request letters of agreement for payment as an out-of-network provider, and pursue other means to obtain reimbursement in accordance with state and federal laws.
(4) (A) A county may report to the Department of Managed Health Care or the Department of Insurance, as appropriate, complaints about a health plan’s or a health insurer’s failure to work in good faith with the county to contract with the county or to be an in-network provider of the health plan or insurer.
(B) A county may also report to the Department of Managed Health Care or the Department of Insurance, respectively, a failure by a health plan or insurer to timely reimburse the county for services the plan or insurer must cover as required by state or federal law, including, but not limited to, Sections 1374.72 and 1374.721 of the Health and Safety Code and Sections 10144.5 and 10144.52 of the Insurance Code.
(C) Upon receipt of a complaint from a county, the Department of Managed Health Care or the Department of Insurance, as applicable, shall timely investigate the complaint.
(b) (1) (A) Notwithstanding subdivision (a) and except as provided in paragraph (2), the Controller may use the funds created pursuant to this part for loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code.
(B) Those loans shall be repaid from the General Fund with interest computed at 110 percent of the Pooled Money Investment Account rate, with interest commencing to accrue on the date the loan is made from the fund.
(C) This subdivision does not authorize a transfer that would interfere with the carrying out of the object for which these funds were created.
(2) This subdivision does not apply to the Supportive Housing Program Subaccount created by subdivision (f) of Section 5890 or moneys paid by the California Health Facilities Financing Authority to the Department of Housing and Community Development as a service fee pursuant to a service contract authorized by Section 5849.35.
(c) Commencing July 1, 2012, on or before the 15th day of each month, pursuant to a methodology provided by the State Department of Health Care Services, the Controller shall distribute to each Local Behavioral Health Service Fund established by counties, pursuant to subdivision (g) of Section 5892, all unexpended and unreserved funds on deposit as of the last day of the prior month in the Behavioral Health Services Fund, established pursuant to Section 5890, for the provision of programs and other related activities set forth in Section 5892.
(d) (1) A county shall base its expenditures on the county mental health and substance use disorder program’s integrated plan or annual update as required by Section 5963.02.
(2) This subdivision does not affect subdivision (a) or (b).
(e) Each year, the State Department of Health Care Services shall post on its internet website the methodology used for allocating revenue from the Behavioral Health Service Fund to the counties.
(f) For purposes of this section, “behavioral health services” shall have the meaning as defined in subdivision (j) of Section 5892.
(g) For purposes of this section, “substance use disorder” shall have the meaning as defined in subdivision (c) of Section 5891.5.
(h) For purposes of this section, “substance use disorder treatment services” shall have the meaning as defined in subdivision (c) of Section 5891.5.
(i) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 82.

Section 5891.5 of the Welfare and Institutions Code is amended to read:

5891.5.

(a) (1) The programs in paragraphs (1) to (3), inclusive, and paragraph (5) of subdivision (a) of Section 5890 may include substance use disorder treatment for children, adults, and older adults with cooccurring mental health and substance use disorders who are eligible to receive mental health services pursuant to those programs. The MHSA includes persons with a serious mental disorder and a diagnosis of substance abuse in the definition of persons who are eligible for MHSA services in Sections 5878.2 and 5813.5, which reference paragraph (2) of subdivision (b) of Section 5600.3.

(2) Provision of substance use disorder treatment services pursuant to this section shall comply with all applicable requirements of the Mental Health Services Act.

(3) Treatment of cooccurring mental health and substance use disorders shall be identified in a county’s three-year program and expenditure plan or annual update, as required by Section 5847.

(b) (1) When a person being treated for cooccurring mental health and substance use disorders pursuant to subdivision (a) is determined to not need the mental health services that are eligible for funding pursuant to the MHSA, the county shall refer the person receiving treatment to substance use disorder treatment services in a timely manner.

(2) Funding established pursuant to the MHSA may be used to assess whether a person has cooccurring mental health and substance use disorders and to treat a person who is preliminarily assessed to have cooccurring mental health and substance use disorders, even when the person is later determined not to be eligible for services provided with funding established pursuant to the MHSA.

(1) The number of people assessed for cooccurring mental health and substance use disorders.

(2) The number of people assessed for cooccurring mental health and substance use disorders who were ultimately determined to have only a substance use disorder without another cooccurring mental health condition.

(d) The department shall by January 1, 2022, and each January 1 thereafter, publish on its internet website a report summarizing county activities pursuant to this section for the prior fiscal year. Data shall be reported statewide and by county or groupings of counties, as necessary to protect the private health information of persons assessed.

(e) (1) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this section by means of plan or county letters, information notices, plan or provider bulletins, or other similar instructions, without taking any further regulatory action.

(2) On or before July 1, 2025, the department shall adopt regulations necessary to implement this section in accordance with the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.

SEC. 83.

Section 5891.5 is added to the Welfare and Institutions Code, to read:

5891.5.
(a) (1) The programs in paragraphs (2) and (3) of subdivision (a) of Section 5892 shall include substance use disorder treatment services, as defined in this section for children, youth, adults, and older adults with a substance use disorder.
(2) Counties that provide substance use disorder treatment services shall provide all forms of federal Food and Drug Administration approved medications for addiction treatment.
(3) The programs in Section 5840.10 may include services to reduce the risk to children and youth of developing a substance use disorder.
(4) Funding established pursuant to the Behavioral Health Services Act may be used to assess whether a person has a substance use disorder and to treat a person prior to a diagnosis of a substance use disorder, even when the person is later determined not to be eligible for services provided with funding established pursuant to the Behavioral Health Services Act.
(5) Substance use disorder treatment services shall be identified in a county’s integrated plan or annual update, as required by Section 5963.02.
(b) (1) A county shall report to the department data and information regarding implementation of this section specified by the department.
(2) The data and information shall be reported in a form, manner, and frequency determined by the department.
(c) (1) For purposes of this section, “substance use disorder” means an adult, child, or youth who has at least one diagnosis of a moderate or severe substance use disorder from the most current version of the Diagnostic and Statistical Manual of Mental Disorders (DSM) for Substance-Related and Addictive Disorders, with the exception of tobacco-related disorders and non-substance-related disorders.
(2) For purposes of this section, “substance use disorder treatment services” include harm reduction, treatment, and recovery services, including federal Food and Drug Administration approved medications.
(d) (1) The department shall, by January 1, 2022, and each January 1 thereafter, publish on its internet website a report summarizing county activities pursuant to this section for the prior fiscal year.
(2) Data shall be reported statewide and by county or groupings of counties, as necessary to protect the private health information of persons assessed.
(e) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 84.

Section 5892 of the Welfare and Institutions Code is amended to read:

5892.

(a) In order to promote efficient implementation of this act, the county shall use funds distributed from the Mental Health Services Fund as follows:

(1) In the 2005–06, 2006–07, and 2007–08 fiscal years, 10 percent shall be placed in a trust fund to be expended for education and training programs pursuant to Part 3.1 (commencing with Section 5820).

(2) In the 2005–06, 2006–07, and 2007–08 fiscal years, 10 percent for capital facilities and technological needs shall be distributed to counties in accordance with a formula developed in consultation with the County Behavioral Health Directors Association of California to implement plans developed pursuant to Section 5847.

(3) Twenty percent of funds distributed to the counties pursuant to subdivision (c) of Section 5891 shall be used for prevention and early intervention programs in accordance with Part 3.6 (commencing with Section 5840).

(4) The expenditure for prevention and early intervention may be increased in any county in which the department determines that the increase will decrease the need and cost for additional services to persons with severe mental illness in that county by an amount at least commensurate with the proposed increase.

(5) The balance of funds shall be distributed to county mental health programs for services to persons with severe mental illnesses pursuant to Part 4 (commencing with Section 5850) for the children’s system of care and Part 3 (commencing with Section 5800) for the adult and older adult system of care. These services may include housing assistance, as defined in Section 5892.5, to the target population specified in Section 5600.3.

(6) Five percent of the total funding for each county mental health program for Part 3 (commencing with Section 5800), Part 3.6 (commencing with Section 5840), and Part 4 (commencing with Section 5850), shall be utilized for innovative programs in accordance with Sections 5830, 5847, and 5848.

(b) (1) In any fiscal year after the 2007–08 fiscal year, programs for services pursuant to Part 3 (commencing with Section 5800) and Part 4 (commencing with Section 5850) may include funds for technological needs and capital facilities, human resource needs, and a prudent reserve to ensure services do not have to be significantly reduced in years in which revenues are below the average of previous years. The total allocation for purposes authorized by this subdivision shall not exceed 20 percent of the average amount of funds allocated to that county for the previous five fiscal years pursuant to this section.

(2) A county shall calculate an amount it establishes as the prudent reserve for its Local Mental Health Services Fund, not to exceed 33 percent of the average community services and support revenue received for the fund in the preceding five years. The county shall reassess the maximum amount of this reserve every five years and certify the reassessment as part of the three-year program and expenditure plan required pursuant to Section 5847.

(3) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the State Department of Health Care Services may allow counties to determine the percentage of funds to allocate across programs created pursuant to Part 4 (commencing with Section 5850) for the children’s system of care and Part 3 (commencing with Section 5800) for the adult and older adult system of care for the 2020–21 and 2021–22 fiscal years by means of all-county letters or other similar instructions without taking further regulatory action.

(c) The allocations pursuant to subdivisions (a) and (b) shall include funding for annual planning costs pursuant to Section 5848. The total of these costs shall not exceed 5 percent of the total of annual revenues received for the fund. The planning costs shall include funds for county mental health programs to pay for the costs of consumers, family members, and other stakeholders to participate in the planning process and for the planning and implementation required for private provider contracts to be significantly expanded to provide additional services pursuant to Part 3 (commencing with Section 5800) and Part 4 (commencing with Section 5850).

(d) Prior to making the allocations pursuant to subdivisions (a), (b), and (c), funds shall be reserved for the costs for the State Department of Health Care Services, the California Behavioral Health Planning Council, the Office of Statewide Health Planning and Development, the Mental Health Services Oversight and Accountability Commission, the State Department of Public Health, and any other state agency to implement all duties pursuant to the programs set forth in this section. These costs shall not exceed 5 percent of the total of annual revenues received for the fund. The administrative costs shall include funds to assist consumers and family members to ensure the appropriate state and county agencies give full consideration to concerns about quality, structure of service delivery, or access to services. The amounts allocated for administration shall include amounts sufficient to ensure adequate research and evaluation regarding the effectiveness of services being provided and achievement of the outcome measures set forth in Part 3 (commencing with Section 5800), Part 3.6 (commencing with Section 5840), and Part 4 (commencing with Section 5850). The amount of funds available for the purposes of this subdivision in any fiscal year is subject to appropriation in the annual Budget Act.

(e) In the 2004–05 fiscal year, funds shall be allocated as follows:

(1) Forty-five percent for education and training pursuant to Part 3.1 (commencing with Section 5820).

(2) Forty-five percent for capital facilities and technology needs in the manner specified by paragraph (2) of subdivision (a).

(3) Five percent for local planning in the manner specified in subdivision (c).

(4) Five percent for state implementation in the manner specified in subdivision (d).

(f) Each county shall place all funds received from the State Mental Health Services Fund in a local Mental Health Services Fund. The Local Mental Health Services Fund balance shall be invested consistent with other county funds and the interest earned on the investments shall be transferred into the fund. The earnings on investment of these funds shall be available for distribution from the fund in future fiscal years.

(g) All expenditures for county mental health programs shall be consistent with a currently approved plan or update pursuant to Section 5847.

(h) (1) Other than funds placed in a reserve in accordance with an approved plan, any funds allocated to a county that have not been spent for their authorized purpose within three years, and the interest accruing on those funds, shall revert to the state to be deposited into the Reversion Account, hereby established in the fund, and available for other counties in future years, provided, however, that funds, including interest accrued on those funds, for capital facilities, technological needs, or education and training may be retained for up to 10 years before reverting to the Reversion Account.

(2) (A) If a county receives approval from the Mental Health Services Oversight and Accountability Commission of a plan for innovative programs, pursuant to subdivision (e) of Section 5830, the county’s funds identified in that plan for innovative programs shall not revert to the state pursuant to paragraph (1) so long as they are encumbered under the terms of the approved project plan, including any subsequent amendments approved by the commission, or until three years after the date of approval, whichever is later.

(B) Subparagraph (A) applies to all plans for innovative programs that have received commission approval and are in the process at the time of enactment of the act that added this subparagraph, and to all plans that receive commission approval thereafter.

(3) Notwithstanding paragraph (1), funds allocated to a county with a population of less than 200,000 that have not been spent for their authorized purpose within five years shall revert to the state as described in paragraph (1).

(4) (A) Notwithstanding paragraphs (1) and (2), if a county with a population of less than 200,000 receives approval from the Mental Health Services Oversight and Accountability Commission of a plan for innovative programs, pursuant to subdivision (e) of Section 5830, the county’s funds identified in that plan for innovative programs shall not revert to the state pursuant to paragraph (1) so long as they are encumbered under the terms of the approved project plan, including any subsequent amendments approved by the commission, or until five years after the date of approval, whichever is later.

(i) Notwithstanding subdivision (h) and Section 5892.1, unspent funds allocated to a county, and interest accruing on those funds, which are subject to reversion as of July 1, 2019, and July 1, 2020, shall be subject to reversion on July 1, 2021.

(j) If there are revenues available in the fund after the Mental Health Services Oversight and Accountability Commission has determined there are prudent reserves and no unmet needs for any of the programs funded pursuant to this section, including all purposes of the Prevention and Early Intervention Program, the commission shall develop a plan for expenditures of these revenues to further the purposes of this act and the Legislature may appropriate these funds for any purpose consistent with the commission’s adopted plan that furthers the purposes of this act.

(k) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 85.

Section 5892 is added to the Welfare and Institutions Code, to read:

5892.
(a) To promote efficient implementation of this act, the county shall use funds distributed from the Mental Health Services Fund as follows:
(1) Twenty percent of funds distributed to the counties pursuant to subdivision (c) of Section 5891 shall be used for prevention and early intervention programs in accordance with Part 3.6 (commencing with Section 5840).
(2) The expenditure for prevention and early intervention may be increased in a county in which the department determines that the increase will decrease the need and cost for additional services to persons with severe mental illness in that county by an amount at least commensurate with the proposed increase.
(3) The balance of funds shall be distributed to county mental health programs for services to persons with severe mental illnesses pursuant to Part 4 (commencing with Section 5850) for the children’s system of care and Part 3 (commencing with Section 5800) for the adult and older adult system of care. These services may include housing assistance, as defined in Section 5892.5, to the target population specified in Section 5600.3.
(4) Five percent of the total funding for each county mental health program for Part 3 (commencing with Section 5800), Part 3.6 (commencing with Section 5840), and Part 4 (commencing with Section 5850) shall be utilized for innovative programs in accordance with Sections 5830, 5847, and 5848.
(b) (1) Programs for services pursuant to Part 3 (commencing with Section 5800) and Part 4 (commencing with Section 5850) may include funds for technological needs and capital facilities, human resource needs, and a prudent reserve to ensure services do not have to be significantly reduced in years in which revenues are below the average of previous years. The total allocation for purposes authorized by this subdivision shall not exceed 20 percent of the average amount of funds allocated to that county for the previous five fiscal years pursuant to this section.
(2) A county shall calculate a maximum amount it establishes as the prudent reserve for its Local Behavioral Health Services Fund, not to exceed 20 percent of the average of the total funds distributed to the county pursuant to subdivision (c) of Section 5891 in the preceding five years.
(3) A county with a population of less than 200,000 shall calculate a maximum amount it establishes as the prudent reserve for its Local Behavioral Health Services Fund, not to exceed 25 percent of the average of the total funds distributed to the county pursuant to subdivision (c) of Section 5891 in the preceding five years.
(c) The allocations pursuant to subdivisions (a) and (b) shall include funding for annual planning costs pursuant to Section 5848. The total of these costs shall not exceed 5 percent of the total of annual revenues received for the fund. The planning costs shall include funds for county mental health programs to pay for the costs of consumers, family members, and other stakeholders to participate in the planning process and for the planning and implementation required for private provider contracts to be significantly expanded to provide additional services pursuant to Part 3 (commencing with Section 5800) and Part 4 (commencing with Section 5850).
(d) (1) (A) Notwithstanding subdivision (a) of Section 5891, the allocations pursuant to subdivision (a) shall include funding for annual planning costs pursuant to Sections 5963.02 and 5963.03.
(B) The total of these costs shall not exceed 5 percent of the total of annual revenues received for the Local Behavioral Health Services Fund.
(C) The planning costs shall include funds for county mental health and substance use disorder programs to pay for the costs of consumers, family members, and other stakeholders to participate in the planning process.
(2) (A) Notwithstanding subdivision (a) of Section 5891, the allocations pursuant to subdivision (a) may include funding to improve plan operations, quality outcomes, fiscal and programmatic data reporting, and monitoring of subcontractor compliance for all county behavioral health programs, including, but not limited to, programs administered by a Medi-Cal behavioral health delivery system, as defined in subdivision (i) of Section 14184.101, and programs funded by the Projects for Assistance in Transition from Homelessness grant, the Community Mental Health Services Block Grant, and other Substance Abuse and Mental Health Services Administration grants.
(B) The total of these costs shall not exceed 2 percent of the total of annual revenues received for the Local Behavioral Health Services Fund.
(C) A county may commence use of funding pursuant to this paragraph on July 1, 2025.
(e) (1) (A) Prior to making the allocations pursuant to subdivisions (a), (b), (c), and (d), funds shall be reserved for state directed purposes for the California Health and Human Services Agency, the State Department of Health Care Services, the California Behavioral Health Planning Council, the Department of Health Care Access and Information, the Behavioral Health Services Oversight and Accountability Commission, the State Department of Public Health, and any other state agency.
(B) These costs shall not exceed 5 percent of the total of annual revenues received for the fund.
(C) The costs shall include funds to assist consumers and family members to ensure the appropriate state and county agencies give full consideration to concerns about quality, structure of service delivery, or access to services.
(D) The amounts allocated for state directed purposes shall include amounts sufficient to ensure adequate research and evaluation regarding the effectiveness of services being provided and achievement of the outcome measures set forth in Part 3 (commencing with Section 5800), Part 3.6 (commencing with Section 5840), and Part 4 (commencing with Section 5850).
(E) The amount of funds available for the purposes of this subdivision in any fiscal year is subject to appropriation in the annual Budget Act.
(2) Prior to making the allocations pursuant to subdivisions (a), (b), (c), and (d), funds shall be reserved for the costs of the California Health and Human Services Agency to administer a behavioral health workforce initiative. Funding for this purpose shall not exceed thirty-six million dollars. The amount of funds available for the purposes of this subdivision in any fiscal year is subject to appropriation in the annual Budget Act.
(f) Each county shall place all funds received from the State Mental Health Services Fund in a local Mental Health Services Fund. The Local Mental Health Services Fund balance shall be invested consistent with other county funds and the interest earned on the investments shall be transferred into the fund. The earnings on investment of these funds shall be available for distribution from the fund in future fiscal years.
(g) All expenditures for county mental health programs shall be consistent with a currently approved plan or update pursuant to Section 5847.
(h) (1) Other than funds placed in a reserve in accordance with an approved plan, any funds allocated to a county that have not been spent for their authorized purpose within three years, and the interest accruing on those funds, shall revert to the state to be deposited into the Reversion Account, hereby established in the fund, and available for other counties in future years, provided, however, that funds, including interest accrued on those funds, for capital facilities, technological needs, or education and training may be retained for up to 10 years before reverting to the Reversion Account.
(2) (A) If a county receives approval from the Mental Health Services Oversight and Accountability Commission of a plan for innovative programs, pursuant to subdivision (e) of Section 5830, the county’s funds identified in that plan for innovative programs shall not revert to the state pursuant to paragraph (1) so long as they are encumbered under the terms of the approved project plan, including any subsequent amendments approved by the commission, or until three years after the date of approval, whichever is later.
(B) Subparagraph (A) applies to all plans for innovative programs that have received commission approval and are in the process at the time of enactment of the act that added this subparagraph, and to all plans that receive commission approval thereafter.
(3) Notwithstanding paragraph (1), funds allocated to a county with a population of less than 200,000 that have not been spent for their authorized purpose within five years shall revert to the state as described in paragraph (1).
(4) (A) Notwithstanding paragraphs (1) and (2), if a county with a population of less than 200,000 receives approval from the Mental Health Services Oversight and Accountability Commission of a plan for innovative programs, pursuant to subdivision (e) of Section 5830, the county’s funds identified in that plan for innovative programs shall not revert to the state pursuant to paragraph (1) so long as they are encumbered under the terms of the approved project plan, including any subsequent amendments approved by the commission, or until five years after the date of approval, whichever is later.
(B) Subparagraph (A) applies to all plans for innovative programs that have received commission approval and are in the process at the time of enactment of the act that added this subparagraph, and to all plans that receive commission approval thereafter.
(i) Notwithstanding subdivision (h) and Section 5892.1, unspent funds allocated to a county, and interest accruing on those funds, which are subject to reversion as of July 1, 2019, and July 1, 2020, shall be subject to reversion on July 1, 2021.
(j) If there are revenues available in the fund after the State Department of Health Care Services has determined there are prudent reserves and no unmet needs for any of the programs funded pursuant to this section, the department, in consultation with counties, shall develop a plan for expenditures of these revenues to further the purposes of this act and the Legislature may appropriate these funds for any purpose consistent with the department’s plan that furthers the purposes of this act.
(k) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.
(l) This section shall become inoperative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 86.

Section 5892 is added to the Welfare and Institutions Code, to read:

5892.
(a) To promote efficient implementation of this act, the county shall use funds distributed from the Behavioral Health Services Fund as follows:
(1) (A) (i) Thirty percent of funds distributed to the counties pursuant to subdivision (c) of Section 5891 shall be used for housing interventions programs pursuant to Part 3.2 (commencing with Section 5830).
(ii) Of these funds, 50 percent shall be used for housing interventions for persons who are chronically homeless, with a focus on those in encampments.
(iii) Of these funds, no more than 25 percent may be used for capital development projects pursuant to paragraph (2) of subdivision (b) of Section 5830.
(B) Commencing with the 2032–2035 fiscal years’ integrated plan, and ongoing thereafter, the State Department of Health Care Services may establish criteria and a process for approving requests for an exemption from subparagraph (A) that considers factors such as a county’s homeless population, the number of individuals receiving Medi-Cal specialty behavioral health services or substance use disorder treatment services in another county, and other factors as determined by the State Department of Health Care Services.
(2) (A) Thirty-five percent of the funds shall be distributed to counties for full-service partnership programs pursuant to Part 4.1 (commencing with Section 5887).
(B) Commencing with the 2032–2035 fiscal years integrated plan, and ongoing thereafter, the State Department of Health Care Services may establish criteria and a process for approving requests for an exemption from subparagraph (A) that considers factors such as county population, client counts, and other factors as determined by the State Department of Health Care Services.
(C) Housing interventions provided to individuals enrolled in full-service partnership programs shall be funded pursuant to subparagraph (A) of paragraph (1).
(3) (A) Thirty percent of the funds shall be distributed to counties for the following Behavioral Health Services and Supports:
(i) Services pursuant to Part 4 (commencing with Section 5850) for the children’s system of care and Part 3 (commencing with Section 5800) for the adult and older adult system of care, excluding those services specified in paragraphs (1) and (2).
(ii) Early intervention programs in accordance with Part 3.6 (commencing with Section 5840).
(iii) Workforce education and training.
(iv) Capital facilities and technological needs.
(v) Innovative behavioral health pilots and projects.
(vi) A prudent reserve established pursuant to subdivision (b).
(B) (i) A county shall utilize a majority of Behavioral Health Services and Supports funding for early intervention programs.
(ii) A county shall comply with other funding allocations specified by the State Department of Health Care Services for the purposes listed in subparagraph (A).
(4) Five percent of the funds shall be distributed to counties for population-based mental health and substance use disorder prevention programs pursuant to Chapter 3 (commencing with Section 5840.10) of Part 3.6.
(5) (A) A county may pilot and test innovative behavioral health models of care programs or innovative promising practices for the programs specified in paragraphs (1), (2), and (4) and clauses (i) through (iii), inclusive, of subparagraph (A) of paragraph (3).
(B) The goal of these innovative pilots and innovative promising practices is to build the evidence base for the effectiveness of new statewide strategies.
(6) The programs established pursuant to paragraphs (1), (2), and (3) shall include services to address the needs of transition-age youth, 16 to 25 years of age, and transition-age foster youth.
(b) (1) A county shall establish and maintain a prudent reserve to ensure county programs are able to continue to meet the needs of children, adults, and older adults served pursuant to full-service partnership programs pursuant to paragraph (2) of subdivision (a), population-based prevention programs pursuant to paragraph (4) of subdivision (a), the Adult and Older Adult Mental Health System of Care Act (Part 3 (commencing with Section 5800)), Innovative Programs, including housing interventions, (Part 3.2 (commencing with Section 5830)), Prevention and Early Intervention Programs (Part 3.6 (commencing with Section 5840)), and the Children’s Mental Health Services Act (Part 4 (commencing with Section 5850)) during years in which revenues for the Behavioral Health Services Fund are below recent averages adjusted by changes in the state population and the California Consumer Price Index.
(2) A county shall calculate a maximum amount it establishes as the prudent reserve for its Local Behavioral Health Services Fund, not to exceed 20 percent of the average of the total funds distributed to the county pursuant to subdivision (c) of Section 5891 in the preceding five years.
(3) A county with a population of less than 200,000 shall calculate a maximum amount it establishes as the prudent reserve for its Local Behavioral Health Services Fund, not to exceed 25 percent of the average of the total funds distributed to the county pursuant to subdivision (c) of Section 5891 in the preceding five years.
(4) (A) A county shall assess the maximum amount of its prudent reserve pursuant to paragraphs (2) and (3) every three years and shall include a plan for the expenditure of funds exceeding the maximum amount in the county’s integrated plan required pursuant to Section 5963.02.
(B) A county may spend funds exceeding the maximum amount on programs and services authorized in paragraphs (1), (2), (3), and (4) of subdivision (a).
(5) (A) A county may spend prudent reserve funds on the programs and services authorized in paragraphs (1), (2), and (4) and clauses (i) and (ii) of paragraph (3) of subdivision (a).
(B) A county may not spend prudent reserve funds for the purposes specified in paragraph (2) of subdivision (b) of Section 5830.
(c) The programs established pursuant to subdivision (a) shall prioritize services for the following populations:
(1) Adults and older adults with a serious mental illness, as defined in Section 5600.3, or substance use disorder, as defined in Section 5891.5, who satisfy one of the following:
(A) Are chronically homeless or experiencing homelessness or are at risk of homelessness.
(B) Are in, or are at risk of being in, the justice system.
(C) Are reentering the community from prison or jail.
(D) Are at risk of conservatorship pursuant to Chapter 3 (commencing with Section 5350) of Part 1 of Division 5.
(E) Are at risk of institutionalization.
(2) Children and youth with a serious emotional disturbance, as defined in Section 5600.3, or a substance use disorder, as defined in Section 5891.5, who satisfy one of the following:
(A) Are chronically homeless or experiencing homelessness or are at risk of homelessness.
(B) Are in, or at risk of being in, the juvenile justice system.
(C) Are reentering the community from a youth correctional facility.
(D) Are in the child welfare system pursuant to Sections 300, 601, and 602.
(E) Are at risk of institutionalization.
(d) (1) (A) Notwithstanding subdivision (a) of Section 5891, the allocations pursuant to subdivision (a) shall include funding for annual planning costs pursuant to Sections 5963.02 and 5963.03.
(B) The total of these costs shall not exceed 5 percent of the total of annual revenues received for the Local Behavioral Health Services Fund.
(C) The planning costs shall include funds for county mental health and substance use disorder programs to pay for the costs of consumers, family members, and other stakeholders to participate in the planning process.
(2) (A) Notwithstanding subdivision (a) of Section 5891, the allocations pursuant to subdivision (a) may include funding to improve plan operations, quality outcomes, fiscal and programmatic data reporting, and monitoring of subcontractor compliance for all county behavioral health programs, including, but not limited to, programs administered by a Medi-Cal behavioral health delivery system, as defined in subdivision (i) of Section 14184.101, and programs funded by the Projects for Assistance in Transition from Homelessness grant, the Community Mental Health Services Block Grant, and other Substance Abuse and Mental Health Services Administration grants.
(B) The total of these costs shall not exceed 2 percent of the total of annual revenues received for the Local Behavioral Health Services Fund.
(C) A county may commence use of funding pursuant to this paragraph on July 1, 2025.
(e) This subdivision shall be effective commencing July 1, 2026.
(1) Prior to making the allocations pursuant to subdivisions (a), (b), (c), and (d), funds shall be reserved for:
(A) State directed purposes consistent with the Behavioral Health Services Act, for the California Health and Human Services Agency, State Department of Health Care Services, the California Behavioral Health Planning Council, the Department of Health Care Access and Information, the Behavioral Health Services Oversight and Accountability Commission, the State Department of Public Health, and any other state agency.
(B) The costs to assist consumers and family members so that the appropriate state and county agencies give full consideration to concerns about quality, structure of service delivery, or access to services.
(C) The costs for research and evaluation regarding the effectiveness of programs and services listed in subdivision (a) and achievement of the outcome measures and metrics pursuant to subdivision (d) of Section 5897.
(D) (i) The costs of the California Health and Human Services Agency to implement a behavioral health workforce initiative. The cost for this initiative shall not exceed 3 percent of the funds allocated pursuant to this subdivision.
(ii) This initiative shall be developed in consultation with labor stakeholders and shall focus on efforts to build and support the workforce to meet the need to provide holistic and quality services and support the development and implementation of strategies to for training, supporting, and retaining the non-county contracted behavioral health workforce.
(iii) A portion of the workforce initiative may focus on providing technical assistance and support to county contracted providers to implement and maintain workforce provisions that support the stabilization and retention of the broad behavioral health workforce.
(2) The costs for the purposes specified in paragraph (1) shall not exceed 8 percent of the total of annual revenues received for the fund. The amount of funds available for the purposes of this subdivision in any fiscal year is subject to appropriation in the annual Budget Act.
(f) Each county shall place all funds received from the State Behavioral Health Services Fund in a local Behavioral Health Services Fund. The Local Behavioral Health Services Fund balance shall be invested consistent with other county funds and the interest earned on the investments shall be transferred into the fund. The earnings on investment of these funds shall be available for distribution from the fund in future fiscal years.
(g) All expenditures for county behavioral health programs shall be consistent with a currently approved plan or update pursuant to Section 5847.
(h) (1) Other than funds placed in a reserve in accordance with an approved plan, any funds allocated to a county that have not been spent for their authorized purpose within three years, and the interest accruing on those funds, shall revert to the state to be deposited into the Reversion Account, hereby established in the fund, and available for other counties in future years, provided, however, that funds, including interest accrued on those funds, for capital facilities, technological needs, or education and training may be retained for up to 10 years before reverting to the Reversion Account.
(2) (A) The Controller shall revert funds by offsetting amounts from each monthly distribution to a county’s Local Behavioral Health Service Fund pursuant to subdivision (c) of Section 5891, until the full amount of the reverted funds has been offset. The reverted funds shall be deposited into the Reversion Account for use, consistent with this section and Sections 5890, 5891 and 5891.5, as determined by the State Department of Health Care Services.
(B) Funds that have been reverted that are owed to a county as a result of an audit adjustment, or for other reasons, shall be paid from the Reversion Account. If the balance of funds in the Reversion Account is inadequate, funds owed to a county shall be offset from the monthly distributions to other counties pursuant to subdivision (c) of Section 5891, based on a methodology provided by the State Department of Health Care Services. Owed funds shall be paid to a county in the monthly distribution pursuant to subdivision (c) of Section 5891.
(C) If the State Department of Health Care Services withholds funds from a monthly distribution to a county pursuant to subdivision (e) of Section 5963.04, funds shall be reverted first and the remaining balance shall be withheld.
(3) Notwithstanding paragraph (1), funds allocated to a county with a population of less than 200,000 that have not been spent for their authorized purpose within five years shall revert to the state as described in paragraph (1).
(i) If there are revenues available in the fund after the State Department of Health Care Services has determined there are prudent reserves and no unmet needs for any of the programs funded pursuant to this section, the department, in consultation with counties, shall develop a plan for expenditures of these revenues to further the purposes of this act and the Legislature may appropriate these funds for any purpose consistent with the department’s plan that furthers the purposes of this act.
(j) For purposes of this section, and elsewhere in law where specified, the following definitions shall apply:
(1) “Experiencing homelessness or are at risk of homelessness” means people who are homeless or at risk of homelessness, as defined in Section 91.5 of Title 24 of the Code of Federal Regulations, or as otherwise defined by the State Department of Health Care Services for purposes of the Medi-Cal program.
(2) “Chronically homeless” means an individual or family that is chronically homeless, as defined in Section 11360 of Title 42 of the United States Code, or as otherwise defined by the State Department of Health Care Services.
(3) “Behavioral health services” means mental health services and substance use disorder treatment services, as defined in Section 5891.5.
(4) “Workforce education and training” includes, but is not limited to, the following for the county workforce:
(A) Workforce recruitment, development, training, and retention.
(B) Professional licensing and/or certification testing and fees.
(C) Loan repayment.
(D) Retention incentives and stipends.
(E) Internship and apprenticeship programs.
(F) Continuing education.
(G) Efforts to increase the racial, ethnic, and geographic diversity of the behavioral health workforce.
(k) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 87.

Section 5892.1 of the Welfare and Institutions Code is amended to read:

5892.1.

(a) All unspent funds subject to reversion pursuant to subdivision (h) of Section 5892 as of July 1, 2017, are deemed to have been reverted to the fund and reallocated to the county of origin for the purposes for which they were originally allocated.

(b) (1) The department shall, on or before July 1, 2018, in consultation with counties and other stakeholders, prepare a report to the Legislature identifying the amounts that were subject to reversion prior to July 1, 2017, including to which purposes the unspent funds were allocated pursuant to Section 5892.

(2) Prior to the preparation of the report referenced in paragraph (1), the department shall provide to counties the amounts it has determined are subject to reversion, and provide a process for counties to appeal this determination.

(c) (1) By July 1, 2018, each county with unspent funds subject to reversion that are deemed reverted and reallocated pursuant to subdivision (a) shall prepare a plan to expend these funds on or before July 1, 2020. The plan shall be submitted to the commission for review.

(2) A county with unspent funds that are deemed reverted and reallocated pursuant to subdivision (a) that has not prepared and submitted a plan to the commission pursuant to paragraph (1) as of January 1, 2019, shall remit the unspent funds to the state pursuant to paragraph (1) of subdivision (h) of Section 5892 no later than July 1, 2019.

(d) Funds included in the plan required pursuant to subdivision (c) that are not spent as of July 1, 2020, shall revert to the state pursuant to paragraph (1) of subdivision (h) of Section 5892.

(e) Notwithstanding subdivision (d), innovation funds included in the plan required pursuant to subdivision (c) that are not spent by July 1, 2020, or the end of the project plan approved by the Mental Health Service Oversight and Accountability Commission pursuant to subdivision (e) of Section 5830, whichever is later, shall revert to the state pursuant to subdivision (h) of Section 5892.

(f) (1) The requirement for submitting a report imposed under subdivision (b) is inoperative on July 1, 2022, pursuant to Section 10231.5 of the Government Code.

(2) A report to be submitted pursuant to subdivision (b) shall be submitted in compliance with Section 9795 of the Government Code.

(g) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department, without taking any further regulatory action, may implement, interpret, or make specific this section, Section 5899.1, and subdivision (h) of Section 5892, by means of all-county letters or other similar instructions, until applicable regulations are adopted in accordance with Section 5898, or until July 1, 2019, whichever occurs first. The all-county letters or other similar instructions shall be issued only after the department provides the opportunity for public participation and comments.

SEC. 88.

Section 5892.1 is added to the Welfare and Institutions Code, to read:

5892.1.
(a) All unspent funds subject to reversion pursuant to subdivision (i) of Section 5892 as of July 1, 2017, are deemed to have been reverted to the fund and reallocated to the county of origin for the purposes for which they were originally allocated.
(b) (1) The department shall, on or before July 1, 2018, in consultation with counties and other stakeholders, prepare a report to the Legislature identifying the amounts that were subject to reversion prior to July 1, 2017, including to which purposes the unspent funds were allocated pursuant to Section 5892.
(2) Prior to the preparation of the report referenced in paragraph (1), the department shall provide to counties the amounts it has determined are subject to reversion and provide a process for counties to appeal this determination.
(c) (1) By July 1, 2018, each county with unspent funds subject to reversion that are deemed reverted and reallocated pursuant to subdivision (a) shall prepare a plan to expend these funds on or before July 1, 2020. The plan shall be submitted to the commission for review.
(2) A county with unspent funds that are deemed reverted and reallocated pursuant to subdivision (a) that has not prepared and submitted a plan to the commission pursuant to paragraph (1) as of January 1, 2019, shall remit the unspent funds to the state pursuant to paragraph (1) of subdivision (i) of Section 5892 no later than July 1, 2019.
(d) Funds included in the plan required pursuant to subdivision (c) that are not spent as of July 1, 2020, shall revert to the state pursuant to paragraph (1) of subdivision (i) of Section 5892.
(e) Notwithstanding subdivision (d), innovation funds included in the plan required pursuant to subdivision (c) that are not spent by July 1, 2020, or the end of the project plan approved by the Behavioral Health Service Oversight and Accountability Commission pursuant to subdivision (e) of Section 5830, whichever is later, shall revert to the state pursuant to subdivision (h) of Section 5892.
(f) (1) The requirement for submitting a report imposed under subdivision (b) is inoperative on July 1, 2022, pursuant to Section 10231.5 of the Government Code.
(2) A report to be submitted pursuant to subdivision (b) shall be submitted in compliance with Section 9795 of the Government Code.
(g) (1) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department, without taking further regulatory action, may implement, interpret, or make specific this section, Section 5899.1, and subdivision (h) of Section 5892 by means of all-county letters or other similar instructions until applicable regulations are adopted in accordance with Section 5898 or until July 1, 2019, whichever occurs first.
(2) The all-county letters or other similar instructions shall be issued only after the department provides the opportunity for public participation and comments.
(h) This section shall be operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 89.

Section 5892.5 of the Welfare and Institutions Code is amended to read:

5892.5.

(a) (1) The California Housing Finance Agency, with the concurrence of the State Department of Health Care Services, shall release unencumbered Mental Health Services Fund moneys dedicated to the Mental Health Services Act housing program upon the written request of the respective county. The county shall use these Mental Health Services Fund moneys released by the agency to provide housing assistance to the target populations who are identified in Section 5600.3.

(2) For purposes of this section, “housing assistance” means each of the following:

(A) Rental assistance or capitalized operating subsidies.

(B) Security deposits, utility deposits, or other move-in cost assistance.

(D) Moving cost assistance.

(E) Capital funding to build or rehabilitate housing for homeless, mentally ill persons or mentally ill persons who are at risk of being homeless.

(b) For purposes of administering those funds released to a respective county pursuant to subdivision (a), the county shall comply with all of the requirements described in the Mental Health Services Act, including, but not limited to, Sections 5664, 5847, subdivision (h) of Section 5892, and 5899.

SEC. 90.

Section 5892.5 is added to the Welfare and Institutions Code, to read:

5892.5.
(a) (1) The California Housing Finance Agency, with the concurrence of the State Department of Health Care Services, shall release unencumbered Behavioral Health Services Fund moneys dedicated to the Behavioral Health Services Act housing program upon the written request of the respective county.
(2) The county shall use these Behavioral Health Services Fund moneys released by the agency to provide housing interventions pursuant to Section 5830.
(b) For purposes of administering those funds released to a respective county pursuant to subdivision (a), the county shall comply with all of the requirements described in the Behavioral Health Services Act, including, but not limited to, Section 5664, Section 5963.02, subdivision (j) of Section 5892, and Section 5963.04.
(c) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 91.

Section 5893 of the Welfare and Institutions Code is amended to read:

5893.

(a) In any year in which the funds available exceed the amount allocated to counties, such funds shall be carried forward to the next fiscal year to be available for distribution to counties in accordance with Section 5892 in that fiscal year.

(b) All funds deposited into the Mental Health Services Fund shall be invested in the same manner in which other state funds are invested. The fund shall be increased by its share of the amount earned on investments.

SEC. 92.

Section 5893 is added to the Welfare and Institutions Code, to read:

5893.
(a) In a year that the funds available exceed the amount allocated to counties, the excess funds shall be carried forward to the next fiscal year to be available for distribution to counties in accordance with Section 5892 in that fiscal year.
(b) (1) All funds deposited into the Behavioral Health Services Fund shall be invested in the same manner that other state funds are invested.
(2) The fund shall be increased by its share of the amount earned on investments.
(c) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by voters at the March 5, 2024, statewide primary election.

SEC. 93.

Section 5895 of the Welfare and Institutions Code is amended to read:

5895.

~~In the event~~ (a) If any provisions of Part 3 (commencing with Section ~~5800),~~ 5800) or Part 4 (commencing with Section 5850) ~~of this division,~~ are repealed or modified so the purposes of this act cannot be accomplished, the funds in the Mental Health Services Fund shall be administered in accordance with those sections as they read on January 1, 2004.

SEC. 94.

Section 5897 of the Welfare and Institutions Code is amended to read:

5897.

(a) Notwithstanding any other state law, the State Department of Health Care Services shall implement the mental health services provided by Part 3 (commencing with Section 5800), Part 3.6 (commencing with Section 5840), and Part 4 (commencing with Section 5850) through contracts with county mental health programs or counties acting jointly. A contract may be exclusive and may be awarded on a geographic basis. For purposes of this section, a county mental health program includes a city receiving funds pursuant to Section 5701.5.

(b) Two or more counties acting jointly may agree to deliver or subcontract for the delivery of those mental health services. The agreement may encompass all or any part of the mental health services provided pursuant to these parts. Any agreement between counties shall delineate each county’s responsibilities and fiscal liability.

(c) The department shall implement the provisions of Part 3 (commencing with Section 5800), Part 3.2 (commencing with Section 5830), Part 3.6 (commencing with Section 5840), and Part 4 (commencing with Section 5850) through the county mental health services performance contract, as specified in Chapter 2 (commencing with Section 5650) of Part 2.

(d) The department shall conduct program reviews of performance contracts to determine compliance. Each county performance contract shall be reviewed at least once every three years, subject to available funding for this purpose.

(e) When a county mental health program is not in compliance with its performance contract, the department may request a plan of correction with a specific timeline to achieve improvements. The department shall post on its ~~Internet Web site~~ internet website any plans of correction requested and the related findings.

(f) Contracts awarded by the State Department of Health Care Services, the State Department of Public Health, the California Behavioral Health Planning Council, the Office of Statewide Health Planning and Development, and the Mental Health Services Oversight and Accountability Commission pursuant to Part 3 (commencing with Section 5800), Part 3.1 (commencing with Section 5820), Part 3.2 (commencing with Section 5830), Part 3.6 (commencing with Section 5840), Part 3.7 (commencing with Section 5845), Part 4 (commencing with Section 5850), and Part 4.5 (commencing with Section 5890), may be awarded in the same manner in which contracts are awarded pursuant to Section 5814 and the provisions of subdivisions (g) and (h) of Section 5814 shall apply to those contracts.

(g) For purposes of Section 14712, the allocation of funds pursuant to Section 5892 that are used to provide services to Medi-Cal beneficiaries shall be included in calculating anticipated county matching funds and the transfer to the State Department of Health Care Services of the anticipated county matching funds needed for community mental health programs.

SEC. 95.

Section 5897 is added to the Welfare and Institutions Code, to read:

5897.
(a) (1) Notwithstanding any other state law, the State Department of Health Care Services shall implement the programs and services specified in subdivision (a) of Section 5892, and related activities, through contracts with a county or counties acting jointly.
(2) A contract may be exclusive and may be awarded on a geographic basis.
(3) For purposes of this section, a “county” includes a city receiving funds pursuant to Section 5701.5.
(b) (1) Two or more counties acting jointly may agree to deliver or subcontract for the delivery of programs and services pursuant to subdivision (a) of Section 5892.
(2) The agreement may encompass all or part of these programs and services.
(3) An agreement between counties shall delineate each county’s responsibilities and fiscal liability.
(c) The department shall contract with counties, or counties acting jointly pursuant to subdivision (a), through the county behavioral health services performance contract as specified in Chapter 2 (commencing with Section 5650) of Part 2.
(d) (1) The department shall conduct program reviews of performance contracts to determine compliance, including compliance with Sections 5963.02 and 5963.04.
(2) Each county performance contract shall be reviewed at least once every three years, subject to available funding for this purpose.
(e) (1) If a county behavioral health department is not in compliance with its performance contract, the department may request a plan of correction with a specific timeline to achieve improvements and take administrative action, including, but not limited to, the temporary withholding of funds and the imposition of monetary sanctions pursuant to Sections 5655, 5963.04, and 14197.7.
(2) The department shall post plans of correction requested and the related findings on its internet website.
(f) Contracts awarded by the State Department of Health Care Services, the State Department of Public Health, the California Behavioral Health Planning Council, the Department of Health Care Access and Information, and the California Health and Human Services Agency to implement programs and services set forth in subdivision (a) of Section 5892 and programs pursuant to Part 3.1 (commencing with Section 5820) may be awarded in the same manner that contracts are awarded pursuant to Section 5814, and the provisions of subdivisions (g) and (h) of Section 5814 shall apply to those contracts.
(g) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by voters at the March 5, 2024, statewide primary election.

SEC. 96.

Section 5898 of the Welfare and Institutions Code is amended to read:

5898.

(a) The State Department of Health Care Services, in consultation with the Mental Health Services Oversight and Accountability Commission, shall develop regulations, as necessary, for the State Department of Health Care Services, the Mental Health Services Oversight and Accountability Commission, or designated state and local agencies to implement this act. Regulations adopted pursuant to this section shall be developed with the maximum feasible opportunity for public participation and comments.

(b) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 97.

Section 5898 is added to the Welfare and Institutions Code, to read:

5898.
(a) (1) The State Department of Health Care Services shall develop regulations, as necessary, to implement this act.
(2) Regulations adopted pursuant to this section shall be developed with the maximum feasible opportunity for public participation and comments.
(b) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 98.

Section 5899 of the Welfare and Institutions Code is amended to read:

5899.

(a) (1) The State Department of Health Care Services, in consultation with the Mental Health Services Oversight and Accountability Commission and the County Behavioral Health Directors Association of California, shall develop and administer instructions for the Annual Mental Health Services Act Revenue and Expenditure Report. ~~The~~

(2) The instructions shall include a requirement that the county certify the accuracy of this report. ~~With~~

(3) With the exception of expenditures and receipts related to the capital facilities and technology needs component described in paragraph (6) of subdivision (d), each county shall adhere to uniform accounting standards and procedures that conform to the Generally Accepted Accounting Principles prescribed by the Controller pursuant to Section 30200 of the Government Code when accounting for receipts and expenditures of Mental Health Services Act (MHSA) funds in preparing the report. ~~Counties~~

(4) Counties shall report receipts and expenditures related to capital facilities and technology needs using the cash basis of accounting, which recognizes expenditures at the time payment is made. ~~Each~~

(5) Each county shall electronically submit the report to the department and to the Mental Health Services Oversight and Accountability Commission. ~~The~~

(6) The department and the commission shall annually post each county’s report in a text-searchable format on its ~~Internet Web site~~ internet website in a timely manner.

(b) The department, in consultation with the commission and the County Behavioral Health Directors Association of California, shall revise the instructions described in subdivision (a) by July 1, 2017, and as needed thereafter, to improve the timely and accurate submission of county revenue and expenditure data.

(1) Identify the expenditures of MHSA funds that were distributed to each county.

(2) Quantify the amount of additional funds generated for the mental health system as a result of the MHSA.

(3) Identify unexpended ~~funds,~~ funds and interest earned on MHSA funds.

(4) Determine reversion amounts, if applicable, from prior fiscal year distributions.

(d) This report is intended to provide information that allows for the evaluation of all of the following:

(1) Children’s systems of care.

(2) Prevention and early intervention strategies.

(3) Innovative projects.

(4) Workforce education and training.

(5) Adults and older adults systems of care.

(6) Capital facilities and technology needs.

(e) If a county does not submit the annual revenue and expenditure report described in subdivision (a) by the required deadline, the department may withhold MHSA funds until the reports are submitted.

(f) A county shall also report the amount of MHSA funds that were spent on mental health services for veterans.

(g) By October 1, 2018, and by October 1 of each subsequent year, the department shall, in consultation with counties, publish on its ~~Internet Web site~~ internet website a report detailing funds subject to reversion by county and by originally allocated purpose. The report also shall include the date on which the funds will revert to the Mental Health Services Fund.

SEC. 99.

Chapter 3 (commencing with Section 5962) is added to Part 7 of Division 5 of the Welfare and Institutions Code, to read:

CHAPTER 3. Behavioral Health Modernization Act
Article 1. Veterans Behavioral Health and Housing
5962.
(a) The Department of Housing and Community Development, in consultation with the Department of Veterans Affairs, shall determine the methodology and distribution of the grant funds, used for the purposes specified in paragraph (2) of subdivision (a) of Section 5965.04, to those entities it determines to be qualified.
(b) The Department of Housing and Community Development and the Department of Veterans Affairs shall work collaboratively pursuant to a memorandum of understanding to carry out the duties and functions of this article.
5962.01.
As used in this article, the following terms have the following meanings:
(a) “Department” means the Department of Housing and Community Development.
(b) “Behavioral health challenge” means, but is not limited to, a veteran who has a serious mental illness, as defined in Section 5600.3, or a substance use disorder, as defined in Section 5891.5.
5962.02.
(a) The department shall issue guidance regarding the implementation of this article by July 1, 2027.
(b) In developing the guidance referenced in subdivision (a), the department shall consult with the Department of Veterans Affairs regarding supportive services plan standards and other program areas where the Department of Veterans Affairs holds expertise.
5962.03.
(a) Notwithstanding any other law, funds allocated for the purposes specified in paragraph (2) of subdivision (a) of Section 5965.04 shall be disbursed in accordance with the Multifamily Housing Program as provided in Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code and this article, including as grants to cities, counties, and other local public entities, as necessary, consistent with applicable law and guidance, for the following uses:
(1) Acquisition, rehabilitation, or acquisition and rehabilitation of motels, hotels, hostels, or other sites and assets, including apartments, homes, adult residential facilities, residential care facilities for the elderly, manufactured housing, commercial properties, and other buildings with existing uses that could be converted to permanent or interim housing.
(2) Master leasing of properties for noncongregant housing.
(3) Conversion of units from nonresidential to residential.
(4) New construction of dwelling units.
(5) The purchase of affordability covenants and restrictions for units.
(6) Relocation costs for individuals who are being displaced as a result of rehabilitation of existing units.
(7) Upon request and upon demonstration by the eligible applicant that other resources are not available for this purpose, the department may, in its sole discretion, provide funding for capitalized operating subsidies for units purchased, converted, or altered with funds provided pursuant to this section.
(b) Where possible, the department shall allocate the funds described in subdivision (a) in a manner that takes into consideration all of the following:
(1) Geographic need across the state.
(2) The demonstrated ability of the applicant to fund ongoing operating reserves, with priority given to an applicant who demonstrates a commitment to the sustained operations of these units, utilizing ongoing federal and state resources, including, but not limited to, the Veterans Affairs Supportive Housing program and the Behavioral Health Services Act.
(3) The creation of new permanent housing options.
(c) A conflict between the requirements of the Multifamily Housing Program and this article shall be resolved in favor of this article as may be set forth in the guidance authorized by Section 5962.02.
(d) Up to 5 percent of the funds appropriated for this article may be expended for the costs to administer this program.
5962.04.
(a) Notwithstanding any other law, any project funded by a grant pursuant to this article shall be deemed consistent and in conformity with any applicable local plan, standard, or requirement and any applicable coastal plan, local or otherwise, shall be allowed as a permitted use within the zone where the structure is located, and shall not be subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals.
(b) Notwithstanding any other law, the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code) does not apply to a project, including a phased project, funded by a grant pursuant to this chapter if, where applicable, all of the following applicable requirements are satisfied:
(1) No units were acquired by eminent domain.
(2) The units will be in decent, safe, and sanitary condition at the time of occupancy.
(3) Notwithstanding paragraph (1) of subdivision (a) of Section 1720 of the Labor Code, construction of the project constitutes a public works project for purposes of Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code.
(4) The project proponent obtains an enforceable commitment that all contractors and subcontractors performing work on the project will use a skilled and trained workforce for any proposed rehabilitation, construction, or major alterations in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code.
(5) The project proponent submits to the lead agency a letter of support from a county, city, city and county, or other local public entity for any proposed rehabilitation, construction, or major alteration work.
(6) Any acquisition is paid for, in whole or part, with public funds.
(7) The project provides housing units for veterans who are experiencing homelessness, or at risk of homelessness, and who are living with a behavioral health challenge.
(8) Long-term covenants and restrictions require the units to be restricted to veterans who are experiencing homelessness, or at risk of homelessness, and are living with a behavioral health challenge for no fewer than 55 years.
(9) (A) The project does not result in an increase in the existing onsite development footprint of structure, structures, or improvements by more than 10 percent.
(B) An increase to the existing, onsite development footprint shall be exclusively to support the provision of, or conversion to, housing for the designated population, including, but not limited to, both of the following:
(i) Achieving compliance with local, state, and federal requirements.
(ii) Providing sufficient space for the provision of services and amenities.
(c) If a project applicant determines that a project is not subject to the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code) pursuant to this section and the lead agency for the project publicly concurs in that determination, the project applicant shall file a notice of exemption with the Office of Planning and Research and the county clerk of the county where the project is located in the manner specified in subdivisions (b) and (c) of Section 21152 of the Public Resources Code.
5962.05.
The department shall administer funding, as set forth below, subject to modifications set forth by the guidance required by Section 5962.02:
(a) The department may accept funding applications and issue awards on a continuous, over-the-counter basis until the funding has been exhausted or as otherwise required by law.
(b) (1) Each award shall be expended on the uses authorized in subdivision (a) of Section 5962.03 and in accordance with all relevant representations and descriptions in the application, within eight months of the date of the award.
(2) Applicants may ask the department for an extension of this timeframe on the grounds and according to the procedures set forth in the guidelines.
(3) The department director shall have reasonable discretion to approve or deny an extension upon conducting a full and good faith review of the applicant’s extension request.
Article 2. Behavioral Health Planning and Reporting
5963.
(a) It is the intent of the Legislature that this chapter establish the Integrated Plan for Behavioral Health Services and Outcomes, which each county shall develop every three years to include all of the following:
(1) A demonstration of how the county will utilize various funds for behavioral health services to deliver high-quality and timely care along the continuum of services from prevention and wellness in schools and other settings to community-based outpatient care, residential care, crisis care, acute care, and housing services and supports.
(2) A demonstration of how the county will use Behavioral Health Services Act funds to prioritize addressing the needs of those with the most severe mental illness, serious emotional disturbance, and substance use disorders who are experiencing unsheltered homelessness, are incarcerated or at risk of being incarcerated, or have been hospitalized or institutionalized as a result of their behavioral health condition.
(3) A demonstration of how the county will strategically invest in population-based prevention, early intervention, and innovation.
(4) A demonstration of how the county has considered other local program planning efforts in the development of the integrated plan to maximize opportunities to leverage funding and services from other programs, including federal funding, Medi-Cal managed care, and commercial health plans.
(5) A demonstration of how the county will support and retain a robust county and non-county contracted behavioral health workforce to achieve the statewide and local behavioral health outcome goals.
(6) A development process in partnership with local stakeholders.
(7) A set of measures used to track progress and hold counties accountable in meeting specific outcomes and goals of the integrated plan.
(8) Information for the state to consider, if necessary to recommend changes to the county’s integrated plan or requiring sanctions to a county’s Behavioral Health Services Act funding as a result of a county not meeting its obligations or state outcome metrics.
(b) For purposes of this article, the following definitions apply:
(1) “Department” means the State Department of Health Care Services.
(2) “Integrated plan” means the Integrated Plan for Behavioral Health Services and Outcomes required by this section.
5963.01.
(a) A county shall work with each Medi-Cal managed care plan, as defined in subdivision (j) of Section 14184.101, that covers residents of the county on development of the Managed Care plan’s population needs assessment.
(b) A county shall work with its local health jurisdiction on development of its community health improvement plan.
(c) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.
5963.02.
(a) (1) Each county shall prepare and submit an integrated plan and annual updates to the Behavioral Health Services Oversight and Accountability Commission and the department.
(2) All references to the three-year program and expenditure plan mean the integrated plan.
(3) Each county’s Board of Supervisors shall approve the integrated plan and annual updates by June 30 prior to the fiscal year or years the integrated plan or update would cover.
(4) A county shall not use the integrated plan to demonstrate compliance with federal law, state law, or requirements imposed by the department related to programs listed in subdivision (c).
(b) (1) Each section of the integrated plan and annual update listed in subdivision (c) shall be based on available funding or obligations under Section 30025 of the Government Code and corresponding contracts, for the applicable fiscal years and in accordance with established stakeholder engagement and planning requirements as required in Section 5963.03.
(2) A county shall consider relevant data sources to guide addressing local needs, including the prevalence of mental health and substance use disorders, the unmet need for mental health and substance use disorder treatment in the county, and the homelessness point-in-time count, in preparing each integrated plan and annual update, and should use the data to appropriately allocate funding between mental health and substance use disorder treatment services.
(3) A county shall consider the population needs assessment of each Medi-Cal managed care plan, as defined in subdivision (j) of Section 14184.101, that covers residents of the county in preparing each integrated plan and annual update.
(4) A county shall consider the community health improvement plan of the local health jurisdiction for the county in preparing each integrated plan and annual update.
(5) A county shall stratify data to identify behavioral health disparities and consider approaches to eliminate disparities, including, but not limited to, promising practices, models of care, community-defined evidence-based practices, workforce diversity, and cultural responsiveness in preparing each integrated plan and annual update.
(6) A county shall report and consider the achievement of defined goals and outcomes measures of the prior integrated plan and annual update, in addition to other data and information as specified by the department pursuant to Section 5963.05, in preparing each integrated plan and annual update.
(7) A county with more than 200,000 population shall collaborate with the five most populous cities in the county, managed care plans, and continuums of care to outline respective responsibilities and coordination of services related to housing interventions described in Section 5830.
(c) The integrated plan and annual updates shall include a section for each of the following:
(1) (A) Community mental health services provided pursuant to Part 2 (commencing with Section 5600).
(B) Programs and services funded from the Behavioral Health Services Fund pursuant to Section 5890, including a description of how the county meets the requirements of paragraph (7) of subdivision (b).
(C) Programs and services funded by the Projects for Assistance in Transition from Homelessness grant pursuant to Sections 290cc-21 through 290cc-35, inclusive, of Title 42 of the United States Code.
(D) Programs and services funded by the Community Mental Health Services Block Grant pursuant to Sections 300x through 300x-9, inclusive, of Title 42 of the United States Code.
(E) Programs and services funded by the Substance Abuse Block Grant pursuant to Sections 300x-21 through 300x-35, inclusive, of Title 42 of the United States Code.
(F) Programs and services provided pursuant to Article 5 (commencing with Section 14680) of Chapter 8.8 of Part 3 of Division 9 and Chapter 8.9 (commencing with Section 14700) of Part 3 of Division 9.
(G) Programs and services provided pursuant to Article 3.2 (commencing with Section 14124.20) of Chapter 7 of Part 3 of Division 9.
(H) Programs and services provided pursuant to Section 14184.401.
(I) Programs and services funded by distributions from the Opioid Settlements Fund established pursuant to Section 12534 of the Government Code.
(J) Services provided through other federal grants or other county mental health and substance use disorder programs.
(2) (A) A description of how the integrated plan and annual update aligns with statewide behavioral health goals and outcome measures, as defined by the department in consultation with counties and stakeholders, pursuant to Section 5963.05.
(B) Outcome measures may include, but not be limited to, measures that demonstrate achievement of goals to reduce unsheltered homelessness among those eligible for housing interventions pursuant to Section 5830 and measures that demonstrate reductions in the number of people with serious mental illness and substance use disorders who are incarcerated in the county.
(3) A description of how the integrated plan aligns with local goals and outcome measures for behavioral health.
(4) The programs and services specified in paragraph (1) shall include descriptions of efforts to reduce identified disparities in behavioral health outcomes.
(5) A description of the data sources considered to meet the requirements specified in paragraph (2) of subdivision (b).
(6) A description of its workforce strategy, to include actions the county will take to ensure its county and non-county contracted behavioral health workforce is well supported and robust enough to achieve the statewide and local behavioral health goals and measures. This description shall include how the county will do all of the following:
(A) Maintain and monitor a network of appropriate, high-quality county and non-county contracted providers, where applicable, that is sufficient to provide adequate access to services and supports for individuals with behavioral health needs.
(B) Meet federal and state standards for timely access to care and services, considering the urgency of the need for services.
(C) Ensure the health and welfare of the individual and support community integration of the individual.
(D) Promote the delivery of services in a culturally competent manner to all individuals, including those with limited English proficiency and diverse cultural and ethnic backgrounds and disabilities, regardless of age, religion, sexual orientation, and gender identity.
(E) Ensure physical access, reasonable accommodations, and accessible equipment for individuals with physical, intellectual and developmental, and mental disabilities.
(F) Select and retain all contracted network providers, including ensuring all contracted providers meet minimum standards for license, certification, training, experience, and credentialing requirements.
(G) Ensure that the contractor’s hiring practices meet applicable nondiscrimination standards.
(H) Adequately fund contracts to ensure that non-county contracted providers are resourced to achieve the behavioral health goals outlined in their contract for the purposes of meeting statewide metrics.
(I) Conduct oversight of compliance of all federal and state laws and regulations of all contracted network providers.
(J) Fill county vacancies and retain county employees providing direct behavioral health services, if applicable.
(7) Certification by the county behavioral health director, that ensures that the county has complied with all pertinent regulations, laws, and statutes, including stakeholder participation requirements.
(8) Certification by the county behavioral health director and by the county auditor-controller that the county has complied with fiscal accountability requirements, as directed by the department, and that all expenditures are consistent with applicable state and federal law.
(d) The county shall submit its integrated plan and annual updates to the department in a form and manner prescribed by the department.
(e) The department shall post on its internet website, in a timely manner, the integrated plan submitted by every county pursuant to subdivision (a).
(f) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.
5963.03.
(a) (1) Each integrated plan shall be developed with local stakeholders, including, but not limited to, all of the following:
(A) Adults and older adults with serious mental illness or in recovery from a substance use disorder.
(B) Families of children, adults, and older adults with serious mental illness or with a substance use disorder.
(C) Youths or youth mental health or substance use disorder organizations.
(D) Providers of mental health services and substance use disorder treatment services.
(E) Public safety partners.
(F) Education agencies.
(G) Higher education partners.
(H) Early childhood organizations.
(I) Local health jurisdictions.
(J) County social services and child welfare agencies.
(K) Labor representative organizations.
(L) Veterans.
(M) Representatives from veterans organizations.
(N) Health care organizations.
(O) Health care service plans, including Medi-Cal managed care plans as defined in subdivision (j) of Section 14184.101.
(P) Disability insurers.
(Q) Tribal and Indian Health Program designees established for Medi-Cal Tribal consultation purposes.
(R) The five most populous cities in counties with a population greater than 200,000.
(S) Area agencies on aging.
(T) Independent living centers.
(U) Continuums of care.
(V) Regional centers.
(2) (A) (i) A county shall demonstrate a partnership with constituents and stakeholders throughout the process that includes meaningful stakeholder involvement on mental health and substance use disorder policy, program planning, and implementation, monitoring, workforce, quality improvement, health equity, evaluation, and budget allocations.
(ii) Stakeholders shall include sufficient participation of individuals representing diverse viewpoints, including, but not limited to, representatives from youth from historically marginalized communities, representatives from organizations specializing in working with underserved racially and ethnically diverse communities, representatives from LGBTQ+ communities, and victims of domestic violence and sexual abuse.
(B) A draft plan and update shall be prepared and circulated for review and comment for at least 30 days to representatives of stakeholder interest and any interested party who has requested a copy of the draft plan.
(b) (1) The behavioral health board established pursuant to Section 5604 shall conduct a public hearing on the draft integrated plan and annual updates at the close of the 30-day comment period required by subdivision (a).
(2) Each adopted integrated plan and update shall include substantive written recommendations for revisions.
(3) The adopted integrated plan or update shall summarize and analyze the recommended revisions.
(4) The behavioral health board shall review the adopted integrated plan or update and make recommendations to the local mental health agency or local behavioral health agency, as applicable, for revisions.
(5) The local mental health agency, local substance use disorder agency, or local behavioral health agency, as applicable, shall provide an annual report of written explanations to the local governing body and the department for substantive recommendations made by the local behavioral health board that are not included in the final integrated plan or update.
(c) (1) A county shall prepare annual updates to its integrated plan and may prepare intermittent updates.
(2) In preparing annual and intermittent updates:
(A) A county is not required to comply with the stakeholder process described in subdivisions (a) and (b).
(B) A county shall post on its internet website all updates to its integrated plan and a summary and justification of the changes made by the updates for a 30-day comment period prior to the effective date of the updates.
(d) For purposes of this section, “substantive recommendations made by the local behavioral health board” means a recommendation that is brought before the board and approved by a majority vote of the membership present at a public hearing of the local behavioral health board that has established a quorum.
(e) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.
5963.04.
(a) (1) Annually, counties and Medi-Cal behavioral health delivery systems, as defined in subdivision (i) of Section 14184.101, shall submit the County Behavioral Health Outcomes, Accountability, and Transparency Report to the department.
(2) This report shall include the following data and information that shall be submitted in a form, manner, and in accordance with timelines prescribed by the department:
(A) The county’s annual allocation of state and federal behavioral health funds, by category.
(B) The county’s annual expenditure of state and federal behavioral health funds, by category.
(C) The amounts of annual and cumulative unspent state and federal behavioral health funds, including funds in a reserve account, by category.
(D) The county’s annual expenditure of county general funds and other funds, by category, on mental health or substance use disorder treatment services.
(E) The sources and amounts spent annually as the nonfederal share for Medi-Cal specialty mental health services and Medi-Cal substance use disorder treatment services, by category.
(F) All administrative costs, by category.
(G) All contracted services, and the cost of those contracted services, by category.
(H) Information on behavioral health services provided to persons not covered by Medi-Cal, including, but not limited to, those who are uninsured or covered by Medicare or commercial insurance, by category.
(I) Other data and information, which shall include, but is not limited to, service utilization data, performance outcome measures across all behavioral health delivery systems, and data and information pertaining to populations with identified disparities in behavioral health outcomes, as specified by the department. Examples may include, but are not limited to, data through the lens of health equity to identify racial, ethnic, and other demographic disparities and inform disparity reduction efforts, the number of people with serious mental illness or substance use disorder, or both, who are incarcerated, experiencing homelessness, inclusive of the availability of housing, the number of youth under 26 years of age who access evidence based early psychosis and mood disorder detection and intervention programs.
(J) Data and information on workforce measures and metrics, including, but not limited to, all of the following:
(i) Vacancies and efforts to fill vacancies.
(ii) The number of county employees providing direct clinical behavioral health services.
(iii) Whether there is a net change in the number of county employees providing direct clinical behavioral health services compared to the prior year and an explanation for that change.
(b) The department may establish metrics, in consultation with counties and stakeholders, to measure and evaluate the quality and efficacy of the behavioral health services and programs listed in paragraph (1) of subdivision (c) of Section 5963.02.
(c) Each county’s board of supervisors shall attest that the County Behavioral Health Outcomes, Accountability, and Transparency Report is complete and accurate before it is submitted to the department.
(d) Each year, the department shall post on its internet website a statewide County Behavioral Health Outcomes, Accountability, and Transparency Report.
(e) (1) The department may require a county or Medi-Cal behavioral health delivery system, as defined in subdivision (i) of Section 14184.101, to revise its integrated plan or annual update pursuant to Section 5963.02 if the department determines the plan or update fails to adequately address local needs pursuant to paragraph (2) of subdivision (b) of Section 5963.02.
(2) The department may impose a corrective action plan or require a county or Medi-Cal behavioral health delivery system, as defined in subdivision (i) of Section 14184.101, to revise its integrated plan or annual update pursuant to Section 5963.02 if the department determines that the county or delivery system fails to make adequate progress in meeting the metrics established by the department pursuant to subdivision (b).
(3) (A) (i) If a county or Medi-Cal behavioral health delivery system fails to submit the data and information specified in subdivision (a) by the required deadline, or as otherwise required by the department, fails to allocate funding pursuant to Section 5892, or fails to follow the process pursuant to Section 5963.03, the department may impose a corrective action plan or monetary sanctions pursuant to Section 14197.7 and temporarily withhold payments to the county or Medi-Cal behavioral health delivery system.
(ii) Notwithstanding any other law, payments shall be withheld from the Behavioral Health Services Fund.
(B) The department shall temporarily withhold amounts it deems necessary to ensure the county or Medi-Cal behavioral health delivery system comes into compliance.
(C) The department shall release the temporarily withheld funds when it determines the county or Medi-Cal behavioral health delivery system has come into compliance.
(f) This section shall be read in conjunction with, and apply in addition to, any other applicable law that authorizes the department to impose sanctions or otherwise take remedial actions against a county and Medi-Cal behavioral health delivery system.
(g) This section shall become operative on July 1, 2026, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.
5963.05.
(a) Notwithstanding Chapter 3.5 (commencing Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific the amendments made pursuant to this act by means of plan or county letters, information notices, plan or provider bulletins, or other similar instructions without taking further regulatory action.
(b) By July 1, 2033, the department shall adopt regulations necessary to implement, interpret, or make specific the amendments made pursuant to this act in accordance with the requirements of Chapter 3.5 (commencing Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.
(c) (1) For purposes of implementing this act, the department may enter into exclusive or nonexclusive contracts, or amend existing contracts, on a bid or negotiated basis, including contracts to implement new or change existing information technology systems.
(2) Notwithstanding any other law, contracts entered into or amended, or changes to existing information technology systems made pursuant to this subdivision shall be exempt from Chapter 6 (commencing with Section 14825) of Part 5.5 of Division 3 of Title 2 of the Government Code, Article 4 (commencing with Section 19130) of Chapter 5 of Part 2 of Division 5 of Title 2 of the Government Code, Part 2 (commencing with Section 12100) of Division 2 of the Public Contract Code, the Statewide Information Management Manual, and the State Administrative Manual and shall be exempt from the review or approval of any division of the Department of General Services or the Department of Technology.
(d) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.
Article 3. Behavioral Health Infrastructure Act Grant Program
5964.
(a) (1) Community-based treatment settings and residential care settings referenced in paragraph (1) of subdivision (a) of Section 5965.04 shall include, but not be limited to, residential behavioral health treatment facilities.
(2) Settings shall be voluntary, unlocked, and create step downs from higher acuity levels of care along the behavioral health care continuum.
(b) These facilities shall focus on stabilizing and rehabilitating residents’ behavioral health conditions, building recovery skills, encouraging community involvement, and support residents continued treatment and long-term recovery.
(c) Eligible facilities will be defined by the department.
5964.01.
As used in this article, “department” means the State Department of Health Care Services.
5964.02.
(a) (1) Except as provided in subdivision (b), the department shall determine the methodology and distribution of the grant funds that are allocated for the purposes specified in paragraph (1) of subdivision (a) of Section 5965.04 to those entities it determines to be qualified.
(2) The department shall issue guidance regarding the implementation of this article by July 1, 2027.
(b) To receive grant funds pursuant to subdivision (a), an entity shall meet, to the extent applicable and as required by the department, all of the following conditions:
(1) Provide matching funds or real property.
(2) Expend grant funds to supplement, and not supplant, existing funds to construct, acquire, and rehabilitate capital assets.
(3) Report data, in a form and manner and as specified by the department, to the department within 90 days of the end of each quarter for the first five years.
(4) Operate services in the financed facility for the intended purpose for a minimum of 30 years.
(c) Up to 5 percent of the funds appropriated for this article may be expended for the costs to administer this program.
5964.03.
Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this article, in whole or in part, by means of information notices or other similar instructions without taking further regulatory action.
5964.04.
For purposes of implementing this article, the department may enter into exclusive or nonexclusive contracts, or amend existing contracts, on a bid or negotiated basis.
5964.05.
(a) Notwithstanding any other law, a project funded by a grant pursuant to this article shall be deemed consistent and in conformity with any applicable local plan, standard, or requirement and allowed as a permitted use within the zone that the structure is located and shall not be subject to a conditional use permit, discretionary permit, or to other discretionary reviews or approvals.
(b) Notwithstanding any other law, the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code) does not apply to a project, including a phased project, funded by a grant pursuant to this article if, where applicable, all of the following applicable requirements are satisfied:
(1) The project is not acquired by eminent domain.
(2) (A) The project applicant demonstrates that the project is, and will continue to be, licensed by, and in good standing with, the department or other state licensing entity at the time of, and for the duration of, occupancy.
(B) The project shall be in decent, safe, and sanitary condition at the time of occupancy.
(3) Notwithstanding paragraph (1) of subdivision (a) of Section 1720 of the Labor Code, construction of the project constitutes a public works project for purposes of Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code.
(4) The project applicant obtains an enforceable commitment that all contractors and subcontractors performing work on the project will use a skilled and trained workforce for a proposed rehabilitation, construction, or major alteration in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code.
(5) The project applicant submits to the lead agency a letter of support, or other durable documentary proof for the project, from a county, city, or other local public entity for a new proposed construction, major alteration work, or rehabilitation.
(6) The project applicant demonstrates that not less than 95 percent of the total cost of a new construction, facility acquisition, or rehabilitation project is paid for with public funds, private nonprofit funds, or philanthropic funds.
(7) The project applicant demonstrates that the project expands the availability of behavioral health treatment services in the subject jurisdiction.
(8) The project applicant demonstrates that there are long-term covenants and restrictions that require the project to be used to provide behavioral health treatment for no less than 30 years, and those covenants and restrictions may not be amended or extinguished by a subsequent title holder, owner, or operator.
(9) The project does not result in an increase in the existing onsite development footprint of structures or improvements.
(c) If a project applicant determines that a project is not subject to the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code) pursuant to this section and the lead agency for the project publicly concurs in that determination, the project applicant shall file a notice of exemption with the Office of Planning and Research and the county clerk of the county where the project is located and in the manner specified in subdivisions (b) and (c) of Section 21152 of the Public Resources Code.
5964.06.
“Low rent housing project,” as defined in Section 1 of Article XXXIV of the California Constitution, does not apply to a project pursuant to this section that meets any of the following criteria:
(a) The project is privately owned housing, receiving no ad valorem property tax exemption other than exemptions granted pursuant to subdivision (f) or (g) of Section 214 of the Revenue and Taxation Code, not fully reimbursed to all taxing entities, and not more than 49 percent of the dwellings, apartments, or other living accommodations of the development may be occupied by persons of low income.
(b) The project is privately owned housing, is not exempt from ad valorem taxation by reason of public ownership, and is not financed with direct, long-term financing from a public body.
(c) The project is intended for owner occupancy, which may include a limited-equity housing cooperative as defined in Section 50076.5 of the Health and Safety Code, or cooperative or condominium ownership rather than for rental-occupancy.
(d) The project consists of newly constructed, privately owned, one to four family dwellings not located on adjoining sites.
(e) The project consists of existing dwelling units leased by the state public body from the private owner of these dwelling units.
(f) The project consists of the rehabilitation, reconstruction, improvement, or addition to, or replacement of, dwelling units of a previously existing low-rent housing project or a project previously or currently occupied by lower-income households as defined in Section 50079.5 of the Health and Safety Code.
(g) The project consists of the acquisition, rehabilitation, reconstruction, or improvement, or any combination thereof, of a project that, prior to the date of the transaction to acquire, rehabilitate, reconstruct, or improve, or any combination thereof, was subject to a contract for federal or state public body assistance for the purpose of providing affordable housing for low-income households and maintains, or enters into, a contract for federal or state public body assistance for the purpose of providing affordable housing for low-income households.
5964.07.
The provisions of this article are severable. If any provision of this article or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

SEC. 100.

Section 14197.7 of the Welfare and Institutions Code is amended to read:

14197.7.

(a) Notwithstanding any other law, if the director finds that any entity that contracts with the department for the delivery of health care services (contractor), including a Medi-Cal managed care plan or a prepaid health plan, fails to comply with contract requirements, state or federal law or regulations, or the state plan or approved waivers, or for other good cause, the director may terminate the contract or impose sanctions as set forth in this section. Good cause includes, but is not limited to, a finding of deficiency that results in improper denial or delay in the delivery of health care services, potential endangerment to patient care, disruption in the contractor’s provider network, failure to approve continuity of care, that claims accrued or to accrue have not or will not be recompensed, or a delay in required contractor reporting to the department.

(b) The director may identify findings of noncompliance or good cause through any means, including, but not limited to, findings in audits, investigations, contract compliance reviews, quality improvement system monitoring, routine monitoring, facility site surveys, encounter and provider data submissions, grievances and appeals, network adequacy reviews, assessments of timely access requirements, reviews of utilization data, health plan rating systems, fair hearing decisions, complaints from beneficiaries and other stakeholders, whistleblowers, and contractor self-disclosures.

(c) Except when the director determines that there is an immediate threat to the health of Medi-Cal beneficiaries receiving health care services from the contractor, at the request of the contractor, the department shall hold a public hearing to commence 30 days after notice of intent to terminate the contract has been received by the contractor. The department shall present evidence at the hearing showing good cause for the termination. The department shall assign an administrative law judge who shall provide a written recommendation to the department on the termination of the contract within 30 days after conclusion of the hearing. Reasonable notice of the hearing shall be given to the contractor, Medi-Cal beneficiaries receiving services through the contractor, and other interested parties, including any other persons and organizations as the director may deem necessary. The notice shall state the effective date of, and the reason for, the termination.

(d) In lieu of contract termination, the director shall have the power and authority to require or impose a plan of correction and issue one or more of the following sanctions against a contractor for findings of noncompliance or good cause, including, but not limited to, those specified in subdivision (a):

(1) Temporarily or permanently suspend enrollment and marketing activities.

(2) Require the contractor to suspend or terminate contractor personnel or subcontractors.

(3) Issue one or more of the temporary suspension orders set forth in subdivision (j).

(4) Impose temporary management consistent with the requirements specified in Section 438.706 of Title 42 of the Code of Federal Regulations.

(5) Suspend default enrollment of enrollees who do not select a contractor for the delivery of health care services.

(6) Impose civil monetary sanctions consistent with the dollar amounts and violations specified in Section 438.704 of Title 42 of the Code of Federal Regulations, as follows:

(A) A limit of twenty-five thousand dollars ($25,000) for each determination of the following:

(i) The contractor fails to provide medically necessary services that the contractor is required to provide, under law or under its contract with the department, to an enrollee covered under the contract.

(ii) The contractor misrepresents or falsifies information to an enrollee, potential enrollee, or health care provider.

(iii) The contractor distributes directly, or indirectly through an agent or independent contractor, marketing materials that have not been approved by the state or that contain false or materially misleading information.

(B) A limit of one hundred thousand dollars ($100,000) for each determination of the following:

(i) The contractor conducts any act of discrimination against an enrollee on the basis of their health status or need for health care services. This includes termination of enrollment or refusal to reenroll a beneficiary, except as permitted under the Medicaid program, or any practice that would reasonably be expected to discourage enrollment by beneficiaries whose medical condition or history indicates probable need for substantial future medical services.

(ii) The contractor misrepresents or falsifies information that it furnishes to the federal Centers for Medicare and Medicaid Services or to the department.

(C) A limit of fifteen thousand dollars ($15,000) for each beneficiary the director determines was not enrolled because of a discriminatory practice under clause (i) of subparagraph (B). This sanction is subject to the overall limit of one hundred thousand dollars ($100,000) under subparagraph (B).

(e) Notwithstanding the monetary sanctions imposed for the violations set forth in paragraph (6) of subdivision (d), the director may impose monetary sanctions in accordance with this section based on any of the following:

(1) The contractor violates any federal or state statute or regulation.

(2) The contractor violates any provision of its contract with the department.

(3) The contractor violates any provision of the state plan or approved waivers.

(4) The contractor fails to meet quality metrics or benchmarks established by the department. Any changes to the minimum quality metrics or benchmarks made by the department that are effective on or after January 1, 2020, shall be established in advance of the applicable reporting or performance measurement period, unless required by the federal government.

(5) The contractor fails to demonstrate that it has an adequate network to meet anticipated utilization in its service area.

(6) The contractor fails to comply with network adequacy standards, including, but not limited to, time and distance, timely access, and provider-to-beneficiary ratio requirements pursuant to standards and formulae that are set forth in federal or state law, regulation, state plan or contract, and that are posted in advance to the department’s internet website.

(7) The contractor fails to comply with the requirements of a corrective action plan.

(8) The contractor fails to submit timely and accurate network provider data.

(9) The director identifies deficiencies in the contractor’s delivery of health care services.

(10) The director identifies deficiencies in the contractor’s operations, including the timely payment of claims.

(11) The contractor fails to comply with reporting requirements, including, but not limited to, those set forth in Section 53862 of Title 22 of the California Code of Regulations.

(12) The contractor fails to timely and accurately process grievances or appeals.

(f) (1) Monetary sanctions imposed pursuant to subdivision (e) may be separately and independently assessed and may also be assessed for each day the contractor fails to correct an identified deficiency. For a deficiency that impacts beneficiaries, each beneficiary impacted constitutes a separate violation. Monetary sanctions shall be assessed in the following amounts:

(A) Up to twenty-five thousand dollars ($25,000) for a first violation.

(B) Up to fifty thousand dollars ($50,000) for a second violation.

(2) For monetary sanctions imposed on a contractor that is funded from one or more of the realigned accounts described in paragraphs (2) to (4), inclusive, of subdivision (n), the department shall calculate a percentage of the funds attributable to the contractor to be offset per month pursuant to paragraphs (2) to (4), inclusive, of subdivision (n) until the amount offset equals the amount of the penalty imposed pursuant to paragraph (1).

(g) When assessing sanctions pursuant to this section, the director shall determine the appropriate amount of the penalty for each violation based upon one or more of the following nonexclusive factors:

(1) The nature, scope, and gravity of the violation, including the potential harm or impact on beneficiaries.

(2) The good or bad faith of the contractor.

(3) The contractor’s history of violations.

(4) The willfulness of the violation.

(5) The nature and extent to which the contractor cooperated with the department’s investigation.

(6) The nature and extent to which the contractor aggravated or mitigated any injury or damage caused by the violation.

(7) The nature and extent to which the contractor has taken corrective action to ensure the violation will not recur.

(8) The financial status of the contractor, including whether the sanction will affect the ability of the contractor to come into compliance.

(9) The financial cost of the health care service that was denied, delayed, or modified.

(10) Whether the violation is an isolated incident.

(11) The amount of the penalty necessary to deter similar violations in the future.

(12) Any other mitigating factors presented by the contractor.

(h) Except in exigent circumstances in which there is an immediate risk to the health of beneficiaries, as determined by the department, the director shall give reasonable written notice to the contractor of the intention to impose any of the sanctions authorized by this section and others who may be directly interested, including any other persons and organizations as the director may deem necessary. The notice shall include the effective date for, the duration of, and the reason for each sanction proposed by the director. A contractor may request the department to meet and confer with the contractor to discuss information and evidence that may impact the director’s final decision to impose sanctions authorized by this section. The director shall grant a request to meet and confer prior to issuance of a final sanction if the contractor submits the request in writing to the department no later than two business days after the contractor’s receipt of the director’s notice of intention to impose sanctions.

(i) Notwithstanding subdivision (d), the director shall terminate a contract with a contractor that the United States Secretary of Health and Human Services has determined does not meet the requirements for participation in the Medicaid program contained in Subchapter XIX (commencing with Section 1396) of Chapter 7 of Title 42 of the United States Code.

(j) (1) The department may make one or more of the following temporary suspension orders as an immediate sanction:

(A) Temporarily suspend enrollment activities.

(B) Temporarily suspend marketing activities.

(D) Require the contractor to temporarily suspend participation by a specified subcontractor.

(2) The temporary suspension orders shall be effective no earlier than 20 days after the notice specified in subdivision (k).

(k) Prior to issuing a temporary suspension order, or temporarily withholding funds pursuant to subdivision (o), the department shall provide the contractor with a written notice. The notice shall state the department’s intent to impose a temporary suspension or temporary withhold, and specify the nature and effective date of the temporary suspension or temporary withhold. The contractor shall have 30 calendar days from the date of receipt of the notice to file a written appeal with the department. Upon receipt of a written appeal filed by the contractor, the department shall within 15 days set the matter for hearing, which shall be held as soon as possible, but not later than 30 days after receipt of the notice of hearing by the contractor. The hearing may be continued at the request of the contractor if a continuance is necessary to permit presentation of an adequate defense. The temporary suspension order shall remain in effect until the hearing is completed and the department has made a final determination on the merits. However, the temporary suspension order shall be deemed vacated if the director fails to make a final determination on the merits within 60 days after the original hearing has been completed. The department shall stay imposition of a temporary withhold, pursuant to subdivision (o), until the hearing is completed and the department has made a final determination on the merits.

(l) (1) Except as provided in paragraph (2), a contractor may request a hearing in connection with any sanctions applied pursuant to subdivision (d) or (e) within 15 working days after the notice of the effective date of the sanctions has been given, by sending a letter so stating to the address specified in the notice. The department shall stay collection of monetary sanctions upon receipt of the request for a hearing. Collection of the sanction shall remain stayed until the effective date of the final decision of the department.

(2) With respect to mental health plans, the due process and appeals process specified in paragraph (4) of subdivision (b) of Section 14718 shall be made available in connection with any contract termination actions, temporary suspension orders, temporary withholds of funds pursuant to subdivision (o), and sanctions applied pursuant to subdivision (d) or (e).

(m) Except as otherwise provided in this section, all hearings to review the imposition of sanctions, including temporary suspension orders, the withholding or offsetting of funds pursuant to subdivision (n), or the temporary withholding of funds pursuant to subdivision (o), shall be held pursuant to the procedures set forth in Section 100171 of the Health and Safety Code.

(n) (1) If the director imposes monetary sanctions pursuant to this section on a contractor, except for a contractor described in paragraphs (2) to (4), inclusive, the amount of the sanction may be collected by withholding the amount from capitation or other associated payments owed to the contractor.

(2) If the director imposes monetary sanctions on a contractor that is funded from the Mental Health Subaccount, the Mental Health Equity Subaccount, the Vehicle License Collection Account of the Local Revenue Fund, or the Mental Health Account, the director may offset the monetary sanctions from the respective account. The offset is subject to paragraph (2) of subdivision (q).

(3) If the director imposes monetary sanctions on a contractor that is funded from the Behavioral Health Subaccount of the Local Revenue Fund 2011, the director may offset the monetary sanctions from that account from the distribution attributable to the applicable contractor. The offset is subject to paragraph (2) of subdivision (q).

(4) If the director imposes monetary sanctions on a contractor that is funded from any other mental health or substance use disorder realignment funds from which the Controller is authorized to make distributions to the contractor, the director may offset the monetary sanctions from these funds if the funds described in paragraphs (2) and (3) are insufficient for the purposes described in this subdivision, as appropriate. The offset is subject to paragraph (2) of subdivision (q).

(o) (1) Whenever the department determines that a mental health plan or any entity that contracts with the department to provide Drug Medi-Cal services has violated state or federal law, a requirement of this chapter, Chapter 8 (commencing with Section 14200), Chapter 8.8 (commencing with Section 14600), or Chapter 8.9 (commencing with Section 14700), or any regulations, the state plan, or a term or condition of an approved waiver, or a provision of its contract with the department, the department may temporarily withhold payments of federal financial participation and payments from the accounts listed in paragraphs (2) to (4), inclusive, of subdivision (n). The department shall temporarily withhold amounts it deems necessary to ensure the mental health plan or the entity that contracts with the department to provide Drug Medi-Cal services promptly corrects the violation. The department shall release the temporarily withheld funds when it determines the mental health plan or the entity that contracts with the department to provide Drug Medi-Cal services has come into compliance.

(2) A mental health plan, or any entity that contracts with the department to provide Drug Medi-Cal services, may appeal the imposition of a temporary withhold pursuant to this subdivision in accordance with the procedures described in subdivisions (k) and (m). Imposition of a temporary withhold shall be stayed until the effective date of the final decision of the department.

(p) This section shall be read in conjunction with, and apply in addition to, any other applicable law that authorizes the department to impose sanctions or otherwise take remedial action upon contractors.

(q) (1) Notwithstanding any other law, nonfederal moneys collected by the department pursuant to this section, except for moneys collected from a contractor funded from one or more of the realigned accounts described in paragraphs (2) to (4), inclusive, of subdivision (n), shall be deposited into the General Fund for use, and upon appropriation by the Legislature, to address workforce issues in the Medi-Cal program and to improve access to care in the Medi-Cal program.

(2) Monetary sanctions imposed via offset on a contractor that is funded from one or more of the realigned accounts described in paragraphs (2) to (4), inclusive, of subdivision (n) shall be redeposited into the account from which the monetary sanctions were offset pursuant to paragraphs (2) to (4), inclusive, of subdivision (n). The department shall notify the Department of Finance of the percentage reduction for the affected county. The Department of Finance shall subsequently notify the Controller, and the Controller shall redistribute the monetary sanction amount to nonsanctioned counties based on each county’s prorated share of the monthly base allocations from the realigned account. With respect to an individual contractor, the department shall not collect via offset more than 25 percent of the total amount of the funds distributed from the applicable account or accounts that are attributable to the contractor in a given month. If the department is not able to collect the full amount of monetary sanctions imposed on a contractor funded from one or more of the realigned accounts described in paragraphs (2) to (4), inclusive, of subdivision (n) in a given month, the department shall continue to offset the amounts attributable to the contractor in subsequent months until the full amount of monetary sanctions has been collected.

(r) (1) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this section, in whole or in part, by means of plan or county letters, information notices, plan or provider bulletins, or other similar instructions, without taking any further regulatory action.

(2) By July 1, 2025, the department shall adopt any regulations necessary to implement this section in accordance with the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.

(s) This section shall be implemented only to the extent that any necessary federal approvals have been obtained and that federal financial participation is available.

(t) For purposes of this section, “contractor” means any individual, organization, or entity that enters into a contract with the department to provide services to enrolled Medi-Cal beneficiaries pursuant to any of the following:

(1) Article 2.7 (commencing with Section 14087.3), including dental managed care programs developed pursuant to Section 14087.46.

(2) Article 2.8 (commencing with Section 14087.5).

(3) Article 2.81 (commencing with Section 14087.96).

(4) Article 2.82 (commencing with Section 14087.98).

(5) Article 2.9 (commencing with Section 14088).

(6) Article 2.91 (commencing with Section 14089).

(7) Chapter 8 (commencing with Section 14200), including dental managed care plans.

(8) Chapter 8.9 (commencing with Section 14700).

(9) A county Drug Medi-Cal organized delivery system authorized under the California Medi-Cal 2020 Demonstration pursuant to Article 5.5 (commencing with Section 14184) or a successor demonstration or waiver, as applicable.

(u) If amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election, this section shall become inoperative on January 1, 2025, and as of that date is repealed.

SEC. 101.

Section 14197.7 is added to the Welfare and Institutions Code, to read:

14197.7.
(a) (1) Notwithstanding any other law, if the director finds that an entity that contracts with the department for the delivery of health care services (contractor), including a Medi-Cal managed care plan or a prepaid health plan, fails to comply with contract requirements, state or federal law or regulations, or the state plan or approved waivers, or for other good cause, the director may terminate the contract or impose sanctions as set forth in this section.
(2) Good cause includes, but is not limited to, a finding of deficiency that results in improper denial or delay in the delivery of health care services, potential endangerment to patient care, disruption in the contractor’s provider network, failure to approve continuity of care, that claims accrued or to accrue have not or will not be recompensed, or a delay in required contractor reporting to the department.
(b) The director may identify findings of noncompliance or good cause through any means, including, but not limited to, findings in audits, investigations, contract compliance reviews, quality improvement system monitoring, routine monitoring, facility site surveys, encounter and provider data submissions, grievances and appeals, network adequacy reviews, assessments of timely access requirements, reviews of utilization data, health plan rating systems, fair hearing decisions, complaints from beneficiaries and other stakeholders, whistleblowers, and contractor self-disclosures.
(c) (1) Except when the director determines there is an immediate threat to the health of Medi-Cal beneficiaries receiving health care services from the contractor, at the request of the contractor, the department shall hold a public hearing to commence 30 days after notice of intent to terminate the contract has been received by the contractor.
(2) The department shall present evidence at the hearing showing good cause for the termination.
(3) The department shall assign an administrative law judge who shall provide a written recommendation to the department on the termination of the contract within 30 days after conclusion of the hearing.
(4) (A) Reasonable notice of the hearing shall be given to the contractor, Medi-Cal beneficiaries receiving services through the contractor, and other interested parties, including any other person and organization the director may deem necessary.
(B) The notice shall state the effective date of, and the reason for, the termination.
(d) In lieu of contract termination, the director shall have the power and authority to require or impose a plan of correction and issue one or more of the following sanctions against a contractor for findings of noncompliance or good cause, including, but not limited to, those specified in subdivision (a):
(1) Temporarily or permanently suspend enrollment and marketing activities.
(2) Require the contractor to suspend or terminate contractor personnel or subcontractors.
(3) Issue one or more of the temporary suspension orders set forth in subdivision (j).
(4) Impose temporary management consistent with the requirements specified in Section 438.706 of Title 42 of the Code of Federal Regulations.
(5) Suspend default enrollment of enrollees who do not select a contractor for the delivery of health care services.
(6) Impose civil monetary sanctions consistent with the dollar amounts and violations specified in Section 438.704 of Title 42 of the Code of Federal Regulations, as follows:
(A) A limit of twenty-five thousand dollars ($25,000) for each determination of the following:
(i) The contractor fails to provide medically necessary services that the contractor is required to provide, under law or under its contract with the department, to an enrollee covered under the contract.
(ii) The contractor misrepresents or falsifies information to an enrollee, potential enrollee, or health care provider.
(iii) The contractor distributes directly, or indirectly through an agent or independent contractor, marketing materials that have not been approved by the state or that contain false or materially misleading information.
(B) A limit of one hundred thousand dollars ($100,000) for each determination of the following:
(i) The contractor conducts an act of discrimination against an enrollee on the basis of their health status or need for health care services. This includes termination of enrollment or refusal to reenroll a beneficiary, except as permitted under the Medicaid program, or a practice that would reasonably be expected to discourage enrollment by beneficiaries whose medical condition or history indicates probable need for substantial future medical services.
(ii) The contractor misrepresents or falsifies information that it furnishes to the federal Centers for Medicare and Medicaid Services or to the department.
(C) A limit of fifteen thousand dollars ($15,000) for each beneficiary the director determines was not enrolled because of a discriminatory practice under clause (i) of subparagraph (B). This sanction is subject to the overall limit of one hundred thousand dollars ($100,000) under subparagraph (B).
(e) Notwithstanding the monetary sanctions imposed for the violations set forth in paragraph (6) of subdivision (d), the director may impose monetary sanctions in accordance with this section based on any of the following:
(1) The contractor violates a federal or state statute or regulation.
(2) The contractor violates a provision of its contract with the department.
(3) The contractor violates a provision of the state plan or approved waivers.
(4) The contractor fails to meet quality metrics or benchmarks established by the department. Any changes to the minimum quality metrics or benchmarks made by the department that are effective on or after January 1, 2020, shall be established in advance of the applicable reporting or performance measurement period, unless required by the federal government.
(5) The contractor fails to demonstrate that it has an adequate network to meet anticipated utilization in its service area.
(6) The contractor fails to comply with network adequacy standards, including, but not limited to, time and distance, timely access, and provider-to-beneficiary ratio requirements pursuant to standards and formulae that are set forth in federal or state law, regulation, state plan, or contract and that are posted in advance to the department’s internet website.
(7) The contractor fails to comply with the requirements of a corrective action plan.
(8) The contractor fails to submit timely and accurate network provider data.
(9) The director identifies deficiencies in the contractor’s delivery of health care services.
(10) The director identifies deficiencies in the contractor’s operations, including the timely payment of claims.
(11) The contractor fails to comply with reporting requirements, including, but not limited to, those set forth in Section 53862 of Title 22 of the California Code of Regulations.
(12) The contractor fails to timely and accurately process grievances or appeals.
(f) (1) Monetary sanctions imposed pursuant to subdivision (e) may be separately and independently assessed and may also be assessed for each day the contractor fails to correct an identified deficiency. For a deficiency that impacts beneficiaries, each beneficiary impacted constitutes a separate violation. Monetary sanctions shall be assessed in the following amounts:
(A) Up to twenty-five thousand dollars ($25,000) for a first violation.
(B) Up to fifty thousand dollars ($50,000) for a second violation.
(C) Up to one hundred thousand dollars ($100,000) for each subsequent violation.
(2) For monetary sanctions imposed on a contractor that is funded from one or more of the realigned accounts described in paragraphs (2) to (4), inclusive, of subdivision (n), the department shall calculate a percentage of the funds attributable to the contractor to be offset per month pursuant to paragraphs (2) to (4), inclusive, of subdivision (n) until the amount offset equals the amount of the penalty imposed pursuant to paragraph (1).
(g) When assessing sanctions pursuant to this section, the director shall determine the appropriate amount of the penalty for each violation based upon one or more of the following nonexclusive factors:
(1) The nature, scope, and gravity of the violation, including the potential harm or impact on beneficiaries.
(2) The good or bad faith of the contractor.
(3) The contractor’s history of violations.
(4) The willfulness of the violation.
(5) The nature and extent to which the contractor cooperated with the department’s investigation.
(6) The nature and extent to which the contractor aggravated or mitigated any injury or damage caused by the violation.
(7) The nature and extent to which the contractor has taken corrective action to ensure the violation will not recur.
(8) The financial status of the contractor, including whether the sanction will affect the ability of the contractor to come into compliance.
(9) The financial cost of the health care service that was denied, delayed, or modified.
(10) Whether the violation is an isolated incident.
(11) The amount of the penalty necessary to deter similar violations in the future.
(12) Other mitigating factors presented by the contractor.
(h) (1) Except in exigent circumstances in which there is an immediate risk to the health of beneficiaries, as determined by the department, the director shall give reasonable written notice to the contractor of the intention to impose any of the sanctions authorized by this section and others who may be directly interested, including any other persons and organizations the director may deem necessary.
(2) The notice shall include the effective date for, the duration of, and the reason for each sanction proposed by the director.
(3) A contractor may request the department to meet and confer with the contractor to discuss information and evidence that may impact the director’s final decision to impose sanctions authorized by this section.
(4) The director shall grant a request to meet and confer prior to issuance of a final sanction if the contractor submits the request in writing to the department no later than two business days after the contractor’s receipt of the director’s notice of intention to impose sanctions.
(i) Notwithstanding subdivision (d), the director shall terminate a contract with a contractor that the United States Secretary of Health and Human Services has determined does not meet the requirements for participation in the Medicaid program contained in Subchapter XIX (commencing with Section 1396) of Chapter 7 of Title 42 of the United States Code.
(j) (1) The department may make one or more of the following temporary suspension orders as an immediate sanction:
(A) Temporarily suspend enrollment activities.
(B) Temporarily suspend marketing activities.
(C) Require the contractor to temporarily suspend specified personnel of the contractor.
(D) Require the contractor to temporarily suspend participation by a specified subcontractor.
(2) The temporary suspension orders shall be effective no earlier than 20 days after the notice specified in subdivision (k).
(k) (1) Prior to issuing a temporary suspension order, or temporarily withholding funds pursuant to subdivision (o), the department shall provide the contractor with a written notice.
(2) The notice shall state the department’s intent to impose a temporary suspension or temporary withhold and specify the nature and effective date of the temporary suspension or temporary withhold.
(3) The contractor shall have 30 calendar days from the date of receipt of the notice to file a written appeal with the department.
(4) Upon receipt of a written appeal filed by the contractor, the department shall, within 15 days, set the matter for hearing, which shall be held as soon as possible but not later than 30 days after receipt of the notice of hearing by the contractor.
(5) The hearing may be continued at the request of the contractor if a continuance is necessary to permit presentation of an adequate defense.
(6) The temporary suspension order shall remain in effect until the hearing is completed and the department has made a final determination on the merits. However, the temporary suspension order shall be deemed vacated if the director fails to make a final determination on the merits within 60 days of the close of the record for the matter.
(7) The department shall stay imposition of a temporary withhold, pursuant to subdivision (o), until the hearing is completed and the department has made a final determination on the merits within 60 days of the close of the record for the matter.
(l) (1) A contractor may request a hearing in connection with sanctions applied pursuant to subdivision (d) or (e) within 15 working days after the notice of the effective date of the sanctions has been given by sending a letter so stating to the address specified in the notice.
(2) The department shall stay collection of monetary sanctions upon receipt of the request for a hearing.
(3) Collection of the sanction shall remain stayed until the effective date of the final decision of the department.
(m) Except as otherwise provided in this section, all hearings to review the imposition of sanctions, including temporary suspension orders, the withholding or offsetting of funds pursuant to subdivision (n), or the temporary withholding of funds pursuant to subdivision (o) shall be held pursuant to the procedures set forth in Section 100171 of the Health and Safety Code.
(n) (1) If the director imposes monetary sanctions pursuant to this section on a contractor, except for a contractor described in paragraphs (2) to (5), inclusive, the amount of the sanction may be collected by withholding the amount from capitation or other associated payments owed to the contractor.
(2) If the director imposes monetary sanctions on a contractor that is funded from the Mental Health Subaccount, the Mental Health Equity Subaccount, the Vehicle License Collection Account of the Local Revenue Fund, or the Mental Health Account, the director may offset the monetary sanctions from the respective account. The offset is subject to paragraph (2) of subdivision (q).
(3) If the director imposes monetary sanctions on a contractor that is funded from the Behavioral Health Subaccount of the Local Revenue Fund 2011, the director may offset the monetary sanctions from that account from the distribution attributable to the applicable contractor. The offset is subject to paragraph (2) of subdivision (q).
(4) If the director imposes monetary sanctions on a contractor that is funded from another mental health or substance use disorder realignment fund from which the Controller is authorized to make distributions to the contractor, the director may offset the monetary sanctions from these funds if the funds described in paragraphs (2) and (3) are insufficient for the purposes described in this subdivision, as appropriate. The offset is subject to paragraph (2) of subdivision (q).
(5) (A) If the director imposes monetary sanctions pursuant to subdivision (e) of Section 5963.04, the director may offset the monetary sanctions from the Behavioral Health Services Fund from the distribution attributable to the applicable contractor.
(B) With respect to an individual contractor, the department shall not collect via offset more than 25 percent of the total amount of the funds distributed from the Behavioral Health Services Fund that are attributable to the contractor in a given month.
(C) If the department is not able to collect the full amount of monetary sanctions imposed on a contractor in a given month, the department shall continue to offset the amounts attributable to the contractor in subsequent months until the full amount of monetary sanctions has been collected. The offset is subject to paragraph (3) of subdivision (q).
(o) (1) (A) Whenever the department determines that a mental health plan or an entity that contracts with the department to provide Drug Medi-Cal services has violated state or federal law, a requirement of this chapter, Chapter 8 (commencing with Section 14200), Chapter 8.8 (commencing with Section 14600), or Chapter 8.9 (commencing with Section 14700), or any regulations, the state plan, a term or condition of an approved waiver, or a provision of its contract with the department, the department may temporarily withhold payments of federal financial participation and payments from the accounts listed in paragraphs (2) to (4), inclusive, of subdivision (n).
(B) The department shall temporarily withhold amounts it deems necessary to ensure the mental health plan or the entity that contracts with the department to provide Drug Medi-Cal services promptly corrects the violation.
(C) The department shall release the temporarily withheld funds when it determines the mental health plan or the entity that contracts with the department to provide Drug Medi-Cal services has come into compliance.
(2) (A) A mental health plan or an entity that contracts with the department to provide Drug Medi-Cal services may appeal the imposition of a temporary withhold pursuant to this subdivision in accordance with the procedures described in subdivisions (k) and (m).
(B) Imposition of a temporary withhold shall be stayed until the effective date of the final decision of the department.
(p) This section shall be read in conjunction with, and apply in addition to, any other applicable law that authorizes the department to impose sanctions or otherwise take remedial action upon contractors.
(q) (1) Notwithstanding any other law, nonfederal moneys collected by the department pursuant to this section, except for moneys collected from a contractor funded from one or more of the realigned accounts described in paragraphs (2) to (4), inclusive, of subdivision (n), shall be deposited into the General Fund for use and, upon appropriation by the Legislature, to address workforce issues in the Medi-Cal program and improve access to care in the Medi-Cal program.
(2) (A) Monetary sanctions imposed via offset on a contractor that is funded from one or more of the realigned accounts described in paragraphs (2) to (4), inclusive, of subdivision (n) shall be redeposited into the account from which the monetary sanctions were offset pursuant to paragraphs (2) to (4), inclusive, of subdivision (n).
(B) The department shall notify the Department of Finance of the percentage reduction for the affected county.
(C) The Department of Finance shall subsequently notify the Controller, and the Controller shall redistribute the monetary sanction amount to nonsanctioned counties based on each county’s prorated share of the monthly base allocations from the realigned account.
(D) With respect to an individual contractor, the department shall not collect via offset more than 25 percent of the total amount of the funds distributed from the applicable account or accounts that are attributable to the contractor in a given month.
(E) If the department is not able to collect the full amount of monetary sanctions imposed on a contractor funded from one or more of the realigned accounts described in paragraphs (2) to (4), inclusive, of subdivision (n) in a given month, the department shall continue to offset the amounts attributable to the contractor in subsequent months until the full amount of monetary sanctions has been collected.
(3) Monetary sanctions imposed via offset on a contractor pursuant to subdivision (e) of Section 5963.04 shall be redeposited into the account from which the monetary sanctions were offset pursuant to paragraph (5) of subdivision (n).
(r) (1) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this section, in whole or in part, by means of plan or county letters, information notices, plan or provider bulletins, or other similar instructions without taking any further regulatory action.
(2) By July 1, 2030, the department shall adopt regulations necessary to implement this section in accordance with the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.
(s) This section shall be implemented only to the extent that necessary federal approvals have been obtained and that federal financial participation is available.
(t) For purposes of this section, “contractor” means an individual, organization, or entity that enters into a contract with the department to provide services to enrolled Medi-Cal beneficiaries or other individuals receiving behavioral health services, as applicable, pursuant to any of the following:
(1) Article 2.7 (commencing with Section 14087.3), including dental managed care programs developed pursuant to Section 14087.46.
(2) Article 2.8 (commencing with Section 14087.5).
(3) Article 2.81 (commencing with Section 14087.96).
(4) Article 2.82 (commencing with Section 14087.98).
(5) Article 2.9 (commencing with Section 14088).
(6) Article 2.91 (commencing with Section 14089).
(7) Chapter 8 (commencing with Section 14200), including dental managed care plans.
(8) Chapter 8.9 (commencing with Section 14700).
(9) A county Drug Medi-Cal organized delivery system authorized under the California Medi-Cal 2020 Demonstration pursuant to Article 5.5 (commencing with Section 14184) or a successor demonstration or waiver, as applicable.
(10) Part 4.5 (commencing with Section 5890) of Division 5.
(11) Chapter 2 (commencing with Section 5650) of Part 2 of Division 5, solely for purposes of imposition of monetary sanctions pursuant to subdivision (e) of Section 5963.04.
(12) Section 12534 of the Government Code.
(u) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 102.

Section 14197.71 is added to the Welfare and Institutions Code, to read:

14197.71.
(a) The department may, at its discretion, align relevant terms of its contract with a Medi-Cal behavioral health delivery system with the terms of its contract with a Medi-Cal managed care plan, as defined in subdivision (j) of Section 14184.101, for those requirements that apply to both entities. Requirements that apply to both entities include, but are not limited to, all of the following:
(1) Organization and administration of the plan, including key administrative staffing requirements.
(2) Financial information.
(3) Information systems.
(4) Quality improvement systems.
(5) Utilization management.
(6) Provider network.
(7) Provider compensation arrangements.
(8) Provider oversight and monitoring.
(9) Access and availability of services, including, but not limited to, reporting of waitlists for behavioral health services or attesting to no waitlists.
(10) Care coordination and data sharing.
(11) Member services.
(12) Member grievances and appeals data.
(13) Reporting requirements.
(14) Other contractual requirements determined by the department.
(b) The department shall establish minimum quality metrics to measure and evaluate the quality and efficacy of services and programs covered under Medi-Cal behavioral health delivery systems.
(c) (1) Each Medi-Cal behavioral health delivery system shall report annually to the county board of supervisors on utilization, quality, patient care expenditures, and other data as determined by the department.
(2) The board of supervisors shall annually submit an attestation to the department that the county is meeting its obligations to provide realigned programs and services pursuant to clauses (i), (iv), and (v) of subparagraph (B) of paragraph (16) of subdivision (f) of Section 30025 of the Government Code.
(d) (1) Notwithstanding any other state or local law, including, but not limited to, Section 5328 of this code and Sections 11812 and 11845.5 of the Health and Safety Code, the sharing of health, social services, housing, and criminal justice information, records, and other data with and among the department, other state departments, including the State Department of Public Health and the State Department of Social Services, Medi-Cal managed care plans, as defined in subdivision (j) of Section 14184.101, Medi-Cal behavioral health delivery systems, as defined in subdivision (i) of Section 14184.101, counties, health care providers, social services organizations, care coordination and case management teams, and other authorized provider or plan entities, and contractors of all of those entities, shall be permitted to the extent necessary and consistent with federal law.
(2) The department shall issue guidance identifying permissible data-sharing arrangements.
(e) For purposes of this section, the term “Medi-Cal behavioral health delivery system” means an entity or local agency that contracts with the department to provide covered behavioral health Medi-Cal benefits pursuant to Section 14184.400 and Chapter 8.9 (commencing with Section 14700) or a county Drug Medi-Cal Organized Delivery System pilot authorized under the CalAIM Terms and Conditions and described in Section 14184.401 or authorized under the Medi-Cal 2020 Demonstration Project Act pursuant to Article 5.5 (commencing with Section 14184).
(f) This section shall be implemented only to the extent that necessary federal approvals have been obtained and federal financial participation is available and not otherwise jeopardized.
(g) The department shall implement this section no later than January 1, 2027.

SEC. 103.

Section 14707.5 of the Welfare and Institutions Code is amended to read:

14707.5.

(a) It is the intent of the Legislature to develop a performance outcome system for Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) mental health services that will improve outcomes at the individual and system levels and will inform fiscal decisionmaking related to the purchase of services.

(b) The State Department of Health Care Services, in collaboration with the California Health and Human Services Agency, and in consultation with the Mental Health Services Oversight and Accountability Commission, shall create a plan for a performance outcome system for EPSDT mental health services provided to eligible Medi-Cal beneficiaries under the age of 21 pursuant to 42 U.S.C. Section 1396d(a)(4)(B).

(1) Commencing no later than September 1, 2012, the department shall convene a stakeholder advisory committee comprised of representatives of child and youth clients, family members, providers, counties, and the Legislature. This consultation shall inform the creation of a plan for a performance outcome system for EPSDT mental health services.

(2) In developing a plan for a performance outcomes system for EPSDT mental health services, the department shall consider the following objectives, among others:

(A) ~~High quality~~ High-quality and accessible EPSDT mental health services for eligible children and youth, consistent with federal law.

(B) Information that improves practice at the individual, program, and system levels.

(D) Reliable data that are collected and analyzed in a timely fashion.

(3) At a minimum, the plan for a performance outcome system for EPSDT mental health services shall consider evidence-based models for performance outcome systems, such as the Child and Adolescent Needs and Strengths (CANS), federal requirements, including the review by the External Quality Review Organization (EQRO), and, timelines for implementation at the provider, county, and state levels.

(c) The State Department of Health Care Services shall provide the performance outcomes system plan, including milestones and timelines, for EPSDT mental health services described in subdivision (a) to all fiscal committees and appropriate policy committees of the Legislature no later than October 1, 2013.

(d) The State Department of Health Care Services shall propose how to implement the performance outcomes system plan for EPSDT mental health services described in subdivision (a) no later than January 10, 2014.

(e) Commencing no later than February 1, 2014, the department shall convene a stakeholder advisory committee comprised of advocates for and representatives of, child and youth clients, family members, managed care health plans, providers, counties, and the Legislature. The committee shall develop methods to routinely measure, assess, and communicate program information regarding informing, identifying, screening, assessing, referring, and linking Medi-Cal eligible beneficiaries to mental health services and supports. The committee shall also review health plan screenings for mental health illness, health plan referrals to Medi-Cal fee-for-service providers, and health plan referrals to county mental health plans, among others. The committee shall make recommendations to the department regarding performance and outcome measures that will contribute to improving timely access to appropriate care for Medi-Cal eligible beneficiaries.

(1) The department shall incorporate into the performance outcomes system established pursuant to this section the screenings and referrals described in this subdivision, including milestones and timelines, and shall provide an updated performance outcomes system plan to all fiscal committees and the appropriate policy committees of the Legislature no later than October 1, 2014.

(2) The department shall propose how to implement the updated performance systems outcome plan described in paragraph (1) no later than January 10, 2015.

SEC. 104.

Section 14707.5 is added to the Welfare and Institutions Code, to read:

14707.5.
(a) It is the intent of the Legislature to develop a performance outcome system for Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) mental health and substance use disorder treatment services that will improve outcomes at the individual and system levels and will inform fiscal decisionmaking related to the purchase of services.
(b) The State Department of Health Care Services, in collaboration with the California Health and Human Services Agency and in consultation with the Behavioral Health Services Oversight and Accountability Commission, shall create a plan for a performance outcome system for EPSDT mental health and substance use disorder treatment services provided to eligible Medi-Cal beneficiaries under the age of 21 pursuant to 42 U.S.C. Section 1396d(a)(4)(B).
(1) (A) Commencing no later than September 1, 2012, the department shall convene a stakeholder advisory committee comprised of representatives of child and youth clients, family members, providers, counties, and the Legislature.
(B) This consultation shall inform the creation of a plan for a performance outcome system for EPSDT mental health and substance use disorder treatment services.
(2) In developing a plan for a performance outcomes system for EPSDT mental health and substance use disorder treatment services, the department shall consider the following objectives, among others:
(A) High-quality and accessible EPSDT mental health and substance use disorder treatment services for eligible children and youth, consistent with federal law.
(B) Information that improves practice at the individual, program, and system levels.
(C) Minimization of costs by building upon existing resources to the fullest extent possible.
(D) Reliable data that is collected and analyzed in a timely fashion.
(3) At a minimum, the plan for a performance outcome system for EPSDT mental health and substance use disorder treatment services shall consider evidence-based models for performance outcome systems, such as the Child and Adolescent Needs and Strengths (CANS), federal requirements, including the review by the External Quality Review Organization (EQRO), and timelines for implementation at the provider, county, and state levels.
(c) The State Department of Health Care Services shall provide the performance outcomes system plan, including milestones and timelines, for EPSDT mental health and substance use disorder treatment services described in subdivision (a) to all fiscal committees and appropriate policy committees of the Legislature no later than October 1, 2013.
(d) The State Department of Health Care Services shall propose how to implement the performance outcomes system plan for EPSDT mental health and substance use disorder treatment services described in subdivision (a) no later than January 10, 2014.
(e) (1) (A) Commencing no later than February 1, 2014, the department shall convene a stakeholder advisory committee comprised of advocates for, and representatives of, child and youth clients, family members, managed care health plans, providers, counties, and the Legislature.
(B) The committee shall develop methods to routinely measure, assess, and communicate program information regarding informing, identifying, screening, assessing, referring, and linking Medi-Cal eligible beneficiaries to mental health and substance use disorder treatment services and supports.
(C) The committee shall also review health plan screenings for mental health and substance use disorder, health plan referrals to Medi-Cal fee-for-service providers, and health plan referrals to county mental health plans, Drug Medi-Cal counties, and Drug Medi-Cal organized delivery systems, among others.
(D) The committee shall make recommendations to the department regarding performance and outcome measures that will contribute to improving timely access to appropriate care for Medi-Cal eligible beneficiaries.
(2) The department shall incorporate into the performance outcomes system established pursuant to this section the screenings and referrals described in this subdivision, including milestones and timelines, and shall provide an updated performance outcomes system plan to all fiscal committees and the appropriate policy committees of the Legislature no later than October 1, 2014.
(3) The department shall propose how to implement the updated performance systems outcome plan described in paragraph (2) no later than January 10, 2015.
(f) This section shall become operative on January 1, 2025, if amendments to the Mental Health Services Act are approved by the voters at the March 5, 2024, statewide primary election.

SEC. 105.

Section 18 of the Mental Health Services Act, as added by Proposition 63 at the November 2, 2004, statewide general election, is amended to read:

Sec. 18.

(a) This act shall be broadly construed to accomplish its purposes. All of the provisions of this act may be amended by a two-thirds vote of the Legislature so long as such amendments are consistent with and further the intent of this act. The Legislature may by majority vote add provisions to clarify procedures and terms including the procedures for the collection of the tax surcharge imposed by Section 12 of this act.

SEC. 106.
(a) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific the amendments made pursuant to this act by means of plan or county letters, information notices, plan or provider bulletins, or other similar instructions without taking further regulatory action.
(b) By July 1, 2033, the department shall adopt regulations necessary to implement, interpret, or make specific the amendments made pursuant to this act, except for the additions of Article 3 (commencing with Section 5964) of Chapter 3 and Chapter 4 (commencing with Section 5965) of Part 7 of Division 5 of the Welfare and Institutions Code, in accordance with the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.
(c) (1) For purposes of implementing this act, the department may enter into exclusive or nonexclusive contracts, or amend existing contracts, on a bid or negotiated basis, including contracts to implement new or change existing information technology systems.
(2) Notwithstanding any other law, contracts entered into or amended, or changes to existing information technology systems made pursuant to this subdivision shall be exempt from Chapter 6 (commencing with Section 14825) of Part 5.5 of Division 3 of Title 2 of the Government Code, Chapter 5 (commencing with Section 19130) of the Part 2 of Division 5 of Title 2 of the Government Code, Part 2 (commencing with Section 12100) of Division 2 of the Public Contract Code, the Statewide Information Management Manual, and the State Administrative Manual and shall be exempt from the review or approval of any division of the Department of General Services or the Department of Technology.

SEC. 107.
The provisions of this act are severable. If any provision of this act or its application is held invalid or unconstitutional by a decision of a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions or applications of this act. The Legislature declares that it would have enacted this act and each portion thereof not declared invalid or unconstitutional without regard to whether any other portion of this act or its application thereof would be subsequently declared invalid or unconstitutional.

SEC. 108.
This act shall take effect on January 1, 2025, upon approval by the voters of the Behavioral Health Infrastructure Act and amendments to the Mental Health Services Act at the March 5, 2024, statewide primary election.

SEC. 109.
The Behavioral Health Infrastructure Act and amendments to the Mental Health Services Act shall be submitted to the voters at the March 5, 2024, statewide primary election in accordance with provisions of the Government Code and the Elections Code governing the submission of a statewide measure to the voters.

SECTION 1.Section 5891 of the Welfare and Institutions Code is amended to read:
5891.
(a)(1)The funding established pursuant to this act shall be utilized to expand mental health services. These funds shall not be used to supplant existing state or county funds utilized to provide mental health services. The state shall continue to provide financial support for mental health programs with not less than the same entitlements, amounts of allocations from the General Fund or from the Local Revenue Fund 2011 in the State Treasury, and formula distributions of dedicated funds as provided in the 2003–04 fiscal year. The state shall not make any change to the structure of financing mental health services that increase a county’s share of costs or financial risk for mental health services unless the state includes adequate funding to fully compensate for the increased costs or financial risk. These funds shall only be used to pay for the programs authorized in Sections 5890 and 5892. These funds may not be used to pay for any other program. These funds may not be loaned to the General Fund or any other fund of the state, or a county general fund or any other county fund for any purpose other than those authorized by Sections 5890 and 5892.
(2)In order to maximize federal financial participation in furtherance of subdivision (d) of Section 5890, a county shall submit claims for reimbursement to the State Department of Health Care Services in accordance with applicable Medi-Cal rules and procedures for a behavioral health service eligible for reimbursement pursuant to Title XIX or XXI of the federal Social Security Act (42 U.S.C. Secs. 1396 et seq. and 1397aa et seq.) when that service is paid, in whole or in part, using the funding established pursuant to this section.
(b)(1)Notwithstanding subdivision (a), and except as provided in paragraph (2), the Controller may use the funds created pursuant to this part for loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code. Any loan shall be repaid from the General Fund with interest computed at 110 percent of the Pooled Money Investment Account rate, with interest commencing to accrue on the date the loan is made from the fund. This subdivision does not authorize any transfer that would interfere with the carrying out of the object for which these funds were created.
(2)This subdivision does not apply to the Supportive Housing Program Subaccount created by subdivision (f) of Section 5890 or any moneys paid by the California Health Facilities Financing Authority to the Department of Housing and Community Development as a service fee pursuant to a service contract authorized by Section 5849.35.
(c)Commencing July 1, 2012, on or before the 15th day of each month, pursuant to a methodology provided by the State Department of Health Care Services, the Controller shall distribute to each Local Mental Health Service Fund established by counties pursuant to subdivision (f) of Section 5892, all unexpended and unreserved funds on deposit as of the last day of the prior month in the Mental Health Services Fund, established pursuant to Section 5890, for the provision of programs and other related activities set forth in Part 3 (commencing with Section 5800), Part 3.2 (commencing with Section 5830), Part 3.6 (commencing with Section 5840), Part 3.9 (commencing with Section 5849.1), and Part 4 (commencing with Section 5850).
(d)Counties shall base their expenditures on the county mental health program’s three-year program and expenditure plan or annual update, as required by Section 5847. This section does not affect subdivision (a) or (b).
SEC. 2.
If the Commission on State Mandates determines that this act contains costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code.
SEC. 3.
The Legislature finds and declares that this act adds provisions to clarify procedures and terms of the Mental Health Services Act, enacted by Proposition 63 at the November 2, 2004, statewide general election.

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Bill Text: CA SB326 | 2023-2024 | Regular Session | Amended

California Senate Bill 326 (Prior Session Legislation)

LEGISLATIVE COUNSEL'S DIGEST

Digest Key

Bill Text

The people of the State of California do enact as follows:

SECTION 1.

SEC. 2.

SEC. 3.

99277.

SEC. 4.

99277.

SEC. 5.

131315.

SEC. 6.

131315.

SEC. 7.

19602.5.

SEC. 8.

19602.5.

SEC. 9.

1095.5.

SEC. 10.

1095.5.

SEC. 11.

5600.3.

SEC. 12.

5604.

SEC. 13.

5604.1.

SEC. 14.

5604.2.

SEC. 15.

5604.3.

SEC. 16.

5604.5.

SEC. 17.

5610.

SEC. 18.

5610.

SEC. 19.

5613.

SEC. 20.

5614.

SEC. 21.

5675.

SEC. 22.

5771.1.

SEC. 23.

5771.1.

SEC. 24.

5805.

SEC. 25.

5805.

SEC. 26.

5806.

SEC. 27.

5806.

SEC. 28.

5813.5.

SEC. 29.

5813.5.

SEC. 30.

5813.6.

SEC. 31.

5814.

SEC. 32.

5814.

SEC. 33.

5830.

SEC. 34.

5830.

SEC. 35.

5831.

SEC. 36.

5835.

SEC. 37.

5835.

SEC. 38.