BILL ANALYSIS �
AB 1929
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Date of Hearing: May 21, 2014
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 1929 (Chau) - As Amended: May 1, 2014
Policy Committee: Housing and
Community Development Vote: 7 - 0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill authorizes county mental health departments, the
Department of Health Care Services (DHCS), and the California
Housing Finance Agency (CalHFA) to partner in the development of
permanent supportive housing for people with mental illness.
Specifically, this bill:
1)Authorizes a county mental health department to deposit Mental
Health Services Act (MHSA) funding with CalHFA and receive
assistance from CalHFA in developing supportive housing units
for people with mental illness.
2)Provides CalHFA will continue to coordinate with DHCS to
administer the use of the funds.
3)Authorizes CalHFA to charge an administrative fee, paid from a
county's MHSA funds, equal to 1% of future deposits, unless a
county has committed less than $1 million, in which case the
agency may charge up to 1.5%, but not to exceed the reasonable
costs of providing services, to cover the cost of providing
this assistance.
4)Releases MHSA housing program funds currently held by CalHFA
to their respective counties, upon request of those counties,
to be used for the purpose of providing housing assistance for
people with mental illness who are homeless or at risk of
homelessness.
FISCAL EFFECT
On-going costs to CalHFA to administer the use of funds, likely
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fully offset by authorized administrative fees.
COMMENTS
1)Purpose . According to advocates, supportive housing has
proven to be an effective strategy for reducing homelessness
among those with mental illness. At any given moment more
than 133,000 Californians are homeless and roughly 25%, or
33,800, are considered chronically homeless. According to
researchers, at least one-third of chronically homeless people
are mentally ill.
This bill seeks to address the need for supportive housing
mentally ill homeless people by authorizing county mental
health departments, CalHFA, and DHCS to partner in the
development of permanent supportive housing for people with
mental illness. County mental health departments may continue
to deposit MHSA funding with CAlHFA and in return counties may
receive technical and financial assistance from CalHFA for
providing housing assistance for people with mental illness
who are homeless. Additionally, by releasing unexpended funds
from the original $400 million allocation to their respective
counties, counties will better enable them to utilize these
funds for housing assistance.
2)Background . In 2004, California voters approved Proposition
63: the Mental Health Services Act (MHSA). The MHSA imposes a
1% tax on personal earnings over $1 million to fund county-run
mental health programs. In 2006, Governor Schwarzenegger
directed the creation of the MHSA housing program with a
stated goal of providing 10,000 permanent supportive housing
units for individuals with mental illness and their families
and an allocation of up to $75 million per year in MHSA funds
for this purpose.
SB 257 (Chesbro), Chapter 748, Statutes of 2006, codified
CalHFA's authority to finance permanent supportive housing for
people with mental illness and directed CalHFA, in conjunction
with DMH and the Department of Housing and Community
Development (HCD) to present a plan to the Legislature for the
use of Proposition 63 funds for the development of supportive
housing projects.
In 2007, county mental health departments agreed to a one-time
set aside of $400 million of Proposition 63 revenue with
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CalHFA. These funds were allocated to all but the eight least
populated counties for the purpose of building permanent
supportive housing for people with mental illness who are
homeless or at risk of homelessness. Of this $400 million,
counties were authorized to use $75 million per year for
capital costs and $40 million per year for operating and
maintenance costs.
While most counties have already expended their share of the
$400 million allocation, others have not because they received
small allocations that do not make construction of housing
units feasible. These funds reside with the state. Counties
currently receive their MHSA allocations directly, and county
mental health departments have discretion to dedicate
additional MHSA funding toward housing. Some larger counties
have indicated they would like to deposit funds into the
housing program and have CalHFA continue to provide technical
assistance to select housing projects.
Analysis Prepared by : Jennifer Swenson / APPR. / (916)
319-2081