BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON TRANSPORTATION AND HOUSING
                              Senator Jim Beall, Chair
                                2015 - 2016  Regular 

          Bill No:          AB 253            Hearing Date:     1/12/2016
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          |Author:   |Roger Hernández                                       |
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          |Version:  |4/30/2015                                             |
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          |Urgency:  |No                     |Fiscal:      |Yes             |
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          |Consultant|Alison Dinmore                                        |
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          SUBJECT:  Mental health


            DIGEST:  This bill requires state agencies to give a preference  
          to applicants for funding under the Veterans Housing and  
          Homeless Prevention Act of 2014 that demonstrate a multiyear  
          commitment of Mental Health Services Act (MHSA) funding for the  
          applicant's project funding plan.  This bill requires the  
          Governor to appoint two additional members to the Mental Health  
          Services Oversight and Accountability Commission with mental  
          health experience, as specified. This bill also requires the  
          Department of Health Care Services to post specified information  
          from mental health plans to a dedicated Internet webpage and to  
          notify appropriate committees of the Legislature, as specified.

          ANALYSIS:
          
          Existing law:
          
          1)Enacts the Veterans Housing and Homeless Prevention Bond Act  
            of 2014 (VHHP or "the Act"), also known as Proposition 41,  
            which authorized the issuance of $600 million in general  
            obligation bonds to provide multifamily housing to veterans  
            pursuant to the VHHP.  The VHHP required the California  
            Housing Finance Agency (CalHFA), California Department of  
            Housing and Community Development (HCD), and California  
            Department of Veterans Affairs (CalVet) to establish and  
            implement a program that focuses on veterans at risk of  
            homelessness or experiencing temporary or chronic  
            homelessness.  This program will fund the acquisition,  







          AB 253 (Roger Hernández)                          Page 2 of ?
          
          
            construction, rehabilitation, and preservation of affordable  
            multifamily supportive housing, affordable transitional  
            housing, affordable rental housing, or related facilities for  
            veterans and their families to allow veterans to access and  
            maintain housing stability.  

          2)Requires, pursuant to the VHHP, the program to do the  
            following: 

             a)   Leverage public, private, and nonprofit funding sources.  

             b)   Prioritize projects that combine housing and supportive  
               services, including but not limited to: job training,  
               mental health, drug treatment, case management, care  
               coordination, or physical rehabilitation. 

             c)   Ensure that program guidelines and terms provide  
               requirements or scoring criteria to advance applicants that  
               combine permanent or transitional housing, or both, with  
               supportive services for veterans, or for partnering with  
               housing developers or service providers that offer housing  
               or services to veterans.

          1)Defines "supportive housing" as housing occupied by the target  
            population and that is linked to on- or off-site services that  
            assist the resident in retaining the housing, improving his or  
            her health status, and maximizing his or her ability to live  
            and, when possible, work in the community.  The intent is to  
            enable residents to maintain stable lives and places no limit  
            on the length of stay. 

          2)Defines "transitional housing" and "transitional housing  
            development" as a rental housing development that operates  
            under program requirements that call for the termination of  
            assistance and recirculation of the assisted unit to another  
            eligible program recipient at a predetermined future point in  
            time, but not less than six months.  

          3)Establishes the Mental Health Services Oversight and  
            Accountability Commission (MHSOAC) to oversee the  
            implementation of the MHSA, enacted by voters in 2004 as  
            Proposition 63, which provides funds to counties to expand  
            services and develop innovative programs and integrated  
            service plans for mentally ill children, adults, and seniors  
            through a 1% income tax on personal income above $1 million. 








          AB 253 (Roger Hernández)                          Page 3 of ?
          
          

          4)Specifies that the MHSA can only be amended by a two-thirds  
            vote of both houses of the Legislature and only as long as the  
            amendment is consistent with and furthers the intent of the  
            MHSA. Permits provisions clarifying the procedures and terms  
            of the MHSA to be added by majority vote. 

          5)Requires the MHSOAC to consist of 16 voting members as  
            follows: 
             a)   The Attorney General or his or her designee
             b)   The Superintendent of Public Instruction or his or her  
               designee
             c)   The Chair of the Senate Health and Human Services  
               Committee or another member of the Senate selected by the  
               President pro Tempore of the Senate
             d)   The Chair of the Assembly Health Committee or another  
               member of the Assembly selected by the Speaker of the  
               Assembly
             e)   12 members appointed by the Governor that include: 
                     Two people 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
                     A representative of a health care services plan or  
                 insurer

          1)Provides that Department of Health Care Services (DHCS) is  
            responsible for the development and implementation of mental  
            health plans for Medi-Cal beneficiaries. 

          2)Requires mental health plans, whether administered by public  
            or private entities, to provide culturally competent and  
            age-appropriate services, to the extent feasible.









          AB 253 (Roger Hernández)                          Page 4 of ?
          
          
          This bill:

          1)Requires CalHFA, HCD, and CalVet to give preference to  
            applicants for funding from the VHHP for supportive housing  
            projects when the applicant can demonstrate a multiyear  
            commitment of MHSA funding for the applicant's project funding  
            plan. 

          2)Requires the Governor to appoint two additional members to the  
            MHSOAC:  a) a person with knowledge and experience in reducing  
            mental health disparities, and b) a person who is a veteran  
            with knowledge about veteran's mental health issues. 

          3)Requires DHCS to post the cultural competence plan component  
            of each mental health plan on a dedicated Internet webpage  
            within 30 days after the mental health plan has been submitted  
            to DHCS for approval. DHCS must also notify the appropriate  
            fiscal and policy committees of the Legislature once the plan  
            is available on the Internet webpage. 

          COMMENTS:
          
          1)Purpose of the bill.  According to the author, the state faces  
            a conundrum as it invests Proposition 41 funding for the  
            creation of supportive housing for the most vulnerable  
            veterans in our homeless population: veterans with mental  
            health issues.  As a state we have money to build the housing  
            structures but no state funds to provide the vital services.  
            It would be like building a hospital with all the equipment  
            but falling short by not providing doctors or nurses. Building  
            schools without providing counselors or teachers.  AB 253  
            bolsters the link between Proposition 41 bond funds that can  
            only be used for the construction of housing and Proposition  
            63 funds which can be used for services.  This important link  
            between state and local partners is fiscally prudent and  
            ensures our promises are kept to veterans under Proposition 41  
            and Proposition 63.

          2)VHHP guidance about mental health services.  On October 13,  
            2015, the implementing departments adopted their revised VHHP  
            program guidelines based upon feedback from interested  
            stakeholders following the first round of funding.  Among  
            other things, the guidelines: 1) prioritize projects that  
            combine housing and supportive services, and 2) establish  
            application selection criteria that integrate prioritization  








          AB 253 (Roger Hernández)                          Page 5 of ?
          
          
            criteria expressed through preference-point weighting.  Under  
            these guidelines, applications are rated with a maximum total  
            score of 133 points for projects including supportive housing  
            or transitional housing, or both, and 80 points for other  
            projects.  

            Projects that have supportive housing or transitional housing,  
            or both, must comply with the following relevant requirements:  


             a)   Provide case-management services on-site, providing  
               direct services to residents.

             b)   Provide the following minimum services, either directly  
               or through commitment letters or formal agreements with  
               other agencies:
                     Intensive case management to engage with each  
                 veteran and jointly develop an individual service plan
                     Benefits counseling and advocacy, including  
                 assistance in enrolling in Medi-Cal and obtaining other  
                 mainstream services, as well as Veterans Affairs (VA)  
                 system navigation and assistance in obtaining discharge  
                 upgrade and veterans benefits
                     Mental health care, such as assessment, crisis  
                 counseling, individual and group therapy, and support  
                 groups
                     Substance use services, such as treatment, relapse  
                 prevention, and support groups

            Additionally, supportive housing or transitional housing  
            projects must prepare a Supportive Services Plan that is  
            appropriate for the target populations and a budget to show  
            that the funding is adequate (i.e., a line-item budget with  
            supporting documentation and services staffing charts.).  

          1)Flexibility to applicants.  The guidelines currently give  
            preference to projects that can demonstrate that services are  
            adequately funded.  If the guidelines were to give preference  
            to one funding source over another, projects that have  
            experience providing services using another funding source or  
            sources would be ranked lower.  If this bill were enacted, a  
            project using MHSA funding would be given preference over  
            another project that has traditionally utilized local or  
            federal funding sources, even though the other projects may  
            score higher in accordance with the existing guidelines.   








          AB 253 (Roger Hernández)                          Page 6 of ?
          
          
            Adding such a preference could inadvertently preclude a worthy  
            project from receiving funding from the VHHP program.

            Presently, the guidelines do not preclude an applicant from  
            utilizing MHSA funding; in fact, one project in the first  
            round did so.  The guidelines as drafted give equal weight to  
            different funding sources with the intent of providing  
            flexibility to applicants to develop an application and  
            program based upon the most appropriate funds available to  
            them. 

          2)Is there a problem to solve?  VHHP requires HCD, CalHFA, and  
            CalVet to establish and implement a program that, among other  
            things, leverage public (federal, state, and local), private,  
            and nonprofit services, including mental health and drug  
            treatment; promote public and private partnerships; and foster  
            innovative financing opportunities.  Additionally, the  
            guidelines provide flexibility to utilize MHSA funds and the  
            departments have received applications and funded projects  
            that utilize MHSA funds.  The committee may wish to consider  
            whether this bill is an answer in search of a problem.   

          3)Too soon?  The VHHP program recently received applications for  
            the second round of funding and likely will not make the  
            awards until the second quarter of this year.  This second  
            round of funding followed a public process of receiving input  
            from stakeholders on experience from the first round.   
            Generally, with new programs such as this, it takes applicants  
            a couple of funding rounds to fully understand the  
            requirements that a state agency or agencies puts in place.   
            This program in particular places novel requirements that  
            applicants have not seen or experienced before.  On January 5,  
            2016, during a joint Senate oversight hearing on covering the  
            progress of the program, Senators of this committee heard from  
            some stakeholders that they were holding off applying until  
            the third round to fully understand the requirements in the  
            current guidelines.  Making changes to the statute will  
            require the departments to make changes to the guidelines and  
            undergo the public review process, which could lead to  
            uncertainty for those seeking funding and further delay the  
            awarding of funding.  

          4)Double-referral.  This bill was double-referred.  It was heard  
            in the Senate Health Committee on June 24, 2015, and approved  
            8-0. 








          AB 253 (Roger Hernández)                          Page 7 of ?
          
          

          Assembly votes:
               Floor:      79-0
               Appr:       16-1
               Health:     19-0
               H&CD:       4-0
          
          Related Legislation:
          
          SB 384 (Leyva) - requires on or after January 1, 2017, that a  
          percentage of the state funds under the VHHP be reserved for  
          underserved veterans.  This bill is currently in this Committee.  


          SB 689 (Huff) - requires state agencies to prioritize projects  
          under the VHHP that, for the purposes of providing mental health  
          and drug services, either: 1) accept only residents that are  
          prequalified to receive services from the VA, or 2) if they  
          accept residents who receive services from agencies other than  
          the VA, employ on staff or contract for a qualified mental  
          health professional with at least two years' full-time relevant  
          experience providing services to veterans.  This bill is  
          currently in this Committee.  

          AB 639 (Perez, Chapter 727, Statutes of 2013) - created the VHHP  
          and allows for $600 million in bonds to be used for housing  
          homeless and low-income veterans. 

          FISCAL EFFECT:  Appropriation:  No    Fiscal Com.:  Yes     
          Local:  No


            POSITIONS:  (Communicated to the committee before noon on  
          Wednesday,
                          January 6, 2016.)
          
            SUPPORT:  

          California Association of Veteran Service Agencies (co-sponsor)
          The Racial and Ethnic Mental Health Disparities Coalition  
          (co-sponsor)
          The Steinberg Institute (co-sponsor)
          American Legion - Department of California
          AMVETS - Department of California
          California Association of County Veteran Service Officers








          AB 253 (Roger Hernández)                          Page 8 of ?
          
          
          California Pan-Ethnic Health Network
          California State Commanders of Veterans Council, VFW -  
            Department of California
          Disability Rights California
          The Little Hoover Commission
          Mental Health America of California
          Military Officer Association of America, California Council of  
          Chapters
          Vietnam Veterans of America - California State Council

          OPPOSITION:

          California Department of Veterans Affairs 
          California Housing Finance Agency 

          ARGUMENTS IN SUPPORT:  Supporters of this bill state that  
          veterans are overrepresented in the homeless population and  
          often struggle to receive adequate mental health services.   
          County Mental Health systems are financially strapped and some  
          mentally ill homeless veterans are ineligible for mental health  
          care through the federal VA.  AB 253 would establish a more  
          cooperative effort between the state and county behavioral  
          health departments and private non-profits to obtain targeted  
          funding for housing veterans with mental-health conditions.  
          
          ARGUMENTS IN OPPOSITION:  The opposition states that by  
          providing priority points for projects that include Proposition  
          63 funding, qualified programs that utilize other funding and  
          service structures, such as grants from the federal government  
          or services provided by the federal VA, would be put at a  
          competitive disadvantage in the scoring process.  Additionally,  
          this program already has a clause built into the statute that  
          would "prioritize projects that combine housing and supportive  
          services, including but not limited to, job training, mental  
          health and drug treatment, case management, care coordination,  
          or physical rehabilitation."  This bill is therefore unnecessary  
          because mental health is already a priority factor to be  
          considered under the guidelines required by the program. 
          

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          AB 253 (Roger Hernández)                          Page 9 of ?