No Deal Yet On Newsom Mental Health Plan

If Gov. Gavin Newsom was hoping amendments introduced to his mental health overhaul last week would sufficiently appease critics, Tuesday’s back-to-back committee hearings only revealed how much further he has to go to reach a compromise.

The big idea: Newsom wants counties to prioritize behavioral health spending on homeless individuals who have serious mental illness or addiction disorders. Counties get billions of dollars from a special tax that funds mental health services. Newsom’s proposal requires counties to spend 30% of that money on housing programs and asks voters to approve a $4.68 billion bond to increase the number of psychiatric treatment beds in the state. Sen. Susan Talamantes-Eggman, a Democrat from Stockton, is carrying the proposal in the Legislature.

  • Eggman: “Too many Californians are finding themselves without services on the streets in ways that are just unconscionable for all of us.”

Despite significant amendments last week protecting children and youth programs and giving counties more flexibility, many groups remain concerned that core services will be upended. Nevada County Behavioral Health Director Phebe Bell told legislators that counties statewide would have to cut between 60% to 80% of current mental health services to meet the proposed housing mandate.

  • Bell: “We are worried about fixing a much larger broken system, which is the supply of affordable and adequate housing in our state, on the backs of the behavioral health system.”

The most vocal opposition has come from organizations representing current clients. City and county leaders are urging lawmakers to increase the bond measure from $4.68 billion to $6.2 billion to “rapidly deploy new housing and services.”

Newsom’s administration has said the state is putting far more money into behavioral health than it did 20 years ago when voters approved the special mental health tax. Since 2019, approximately $10 billion from Medi-Cal and other sources has been invested in behavioral health. The governor and supporters argue counties need to be held accountable to improving outcomes and spending transparency.

While the Assembly Health Committee approved the bill on Tuesday, a deal needs to be struck before the legislative session ends Sept. 14. Should the proposal pass, voters will get the chance next March to weigh in on both the bond measure and spending reform.


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