BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 1929|
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CONSENT
Bill No: AB 1929
Author: Chau (D)
Amended: 6/26/14 in Senate
Vote: 21
SENATE HEALTH COMMITTEE : 8-0, 6/18/14
AYES: Hernandez, Morrell, Beall, DeSaulnier, Evans, Monning,
Nielsen, Wolk
NO VOTE RECORDED: De Le�n
SENATE TRANSPORTATION & HOUSING COMMITTEE : 11-0, 6/24/14
AYES: DeSaulnier, Gaines, Beall, Cannella, Galgiani, Hueso,
Lara, Liu, Pavley, Roth, Wyland
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 77-0, 5/27/14 (Consent) - See last page for
vote
SUBJECT : California Housing Finance Agency: Mental Health
Services Act funding: special needs housing for
person with mental illness
SOURCE : Author
DIGEST : This bill allows county mental health departments to
deposit Proposition 63 (Mental Health Services Act, MHSA)
funding with the California Housing Finance Agency (CalHFA), as
specified. This bill allows CalHFA to use those funds, as
specified, for special housing needs for those with mental
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illness. This bill requires CalHFA to provide technical
assistance to counties, as specified, and allows CalHFA to
charge a fee to counties of up to 1.5% of the MHSA loan amount
per project, as specified. This bill requires counties to
dedicate funds, as specified, to provide housing assistance to
those with serious mental illness who are homeless or to the
mentally ill at risk of being homeless.
ANALYSIS :
Existing law:
1.Authorizes CalHFA to finance permanent special needs housing,
including for those with mental health illness.
2.Establishes the MHSA Housing Program, which provides permanent
supportive housing for people with mental illness and
allocates up to $75 million per year for this purpose.
3.Imposes a tax of 1% on personal earnings of over $1 million
for the purpose of financing new or expanded mental health
services, pursuant to the MHSA. Allows the Legislature to add
provisions to clarify procedures and terms of the MHSA by a
majority vote.
This bill:
1.Allows a county mental health department to deposit MHSA
funding with CalHFA to develop housing to meet the special
housing needs of those with mental illness.
2.Allows CalHFA to receive MHSA funding from counties to finance
the acquisition, construction, rehabilitation, refinancing, or
development of special needs housing for those with mental
illness. Requires CalHFA to coordinate with the Department of
Health Care Services (DHCS) to administer the use of the MHSA
funds.
3.Allows CalHFA to enter into financial and other agreements
with county and other agencies to commit sufficient county
MHSA funds, including future allocations.
4.Requires CalHFA to provide technical assistance to county
mental health departments as necessary to assist the county in
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selecting special needs housing that best meets the needs of
county residents with mental illness.
5.Allows CalHFA to charge a county a fee of up to 1% of future
allocations to cover the reasonable costs incurred by CalHFA
for providing technical assistance. Allows CalHFA to charge a
county a fee of up to 1.5% of the MHSA loan amount per
project, if the county has committed less than
$1 million. Allows the fees to be paid from the county's MHSA
funds.
6.Requires CalHFA to release unencumbered MHSA funding from the
initial $400 million allocation upon request of the respective
county. Requires the county to dedicate the funds, within one
year of receipt, to providing housing assistance to those with
serious mental illness who are homeless or to the mentally ill
at risk of being homeless. Requires the county to track
expenditure of the funds and report to CalHFA. Defines
"housing assistance" to include, but is not limited to:
A. Rental assistance or capitalized operating subsidies;
B. Housing relocation services;
C. Security deposits, utility deposits, or other move-in
cost assistance;
D. Utility payments;
E. Moving cost assistance;
F. Capital funding to build or rehabilitate affordable
housing for homeless; or, mentally ill people or for the
mentally ill at risk of being homeless.
7.Specifies that these provisions do not preclude a county from
depositing funding from sources other than the funds derived
from the MHSA with CalHFA for the purpose of developing
supportive housing for persons with mental illness.
8.Specifies that it is the Legislature's intent that CalHFA
continue the MHSA Housing Program.
Comments
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According to the author's office, 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. Of these Californians,
roughly 33,800, or 25%, are considered chronically homeless.
According to researchers, at least one-third of chronically
homeless people are mentally ill.
This bill expressly authorizes 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. In return, counties may receive technical
assistance from CalHFA, as well as assistance with financing the
acquisition, construction, rehabilitation, refinancing, or
development of supportive housing units for people with mental
illness. CalHFA is authorized to charge counties a fee, paid
from MHSA funds, for providing this assistance.
Additionally, this bill releases unencumbered funds from the
original $400 million allocation to their respective counties,
upon request of those counties. As these funds were originally
set aside for housing purposes, counties must use them to
provide housing assistance for people with mental illness who
are homeless or at risk of homelessness. Releasing these funds
directly to the counties will better enable them to utilize
these funds for housing assistance.
In 2004, California voters approved Proposition 63 (MHSA). The
MHSA imposes a 1% tax on personal earnings over $1 million to
fund county-run mental health programs. Through Executive Order
S-07-06 in 2006, Governor Schwarzenegger directed the creation
of the MHSA Housing Program to provide, on behalf of counties,
both capital and operating subsidy funding for the development
of permanent supportive housing for individuals with serious
mental illness and who are homeless or at risk of homelessness.
The Executive Order stated a goal of providing 10,000 permanent
supportive housing units for individuals with mental illness and
their families.
To administer the MHSA Housing Program, CalHFA and the
Department of Mental Health -subsequently folded into DHCS -
created a partnership. CalHFA underwrites the requests for
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capital funds and capitalizes operating expenses. DHCS
evaluates each applicant's proposed target population and
supportive services plan. Once funds are awarded, CalHFA
oversees all development and financial aspects of the project,
and DHCS oversees the provision of services. CalHFA also
provides technical assistance to county mental health
departments to select special needs housing that would best meet
the needs of a county's residents with mental illness and
charges an administrative fee for this assistance.
In 2007, 50 county mental health departments agreed to a
one-time set-aside of $400 million of MHSA revenue for the MHSA
Housing Program to build an estimated 2,500 units of permanent
supportive housing for people with mental illness who are
homeless or at risk of homelessness. While most counties have
already used their share of the $400 million allocation, others
have not because they received small allocations that do not
make construction of housing units feasible.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 8/5/14)
California American College of Emergency Physicians
California Council of Community Mental Health Agencies
California Mental Health Directors Association
California Psychiatric Association
California Rural Legal Assistance Foundation
Housing California
Mental Health America of California
National Alliance on Mental Illness, California
National Association of Social Workers, California Chapter
San Diego Housing Federation
Western Center on Law and Poverty
ARGUMENTS IN SUPPORT : Supporters argue that this bill is
needed to codify practices and procedures from the Executive
Order that put into place the MHSA Housing Program, which since
its inception has helped to build more than 2,500 affordable
places for people with severe mental illnesses. Supporters
argue that this approach has demonstrated very good results for
people with mental disorders and could continue to be very
valuable in meeting the housing needs of this vulnerable
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population.
ASSEMBLY FLOOR : 77-0, 5/27/14
AYES: Achadjian, Alejo, Allen, Ammiano, Bigelow, Bloom,
Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian
Calderon, Campos, Chau, Ch�vez, Chesbro, Conway, Cooley,
Dababneh, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox,
Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon,
Gorell, Gray, Grove, Hagman, Hall, Harkey, Roger Hern�ndez,
Holden, Jones, Jones-Sawyer, Levine, Linder, Logue, Lowenthal,
Maienschein, Mansoor, Medina, Melendez, Mullin, Muratsuchi,
Nazarian, Nestande, Olsen, Pan, Perea, John A. P�rez, V.
Manuel P�rez, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas,
Skinner, Stone, Ting, Wagner, Waldron, Weber, Wieckowski,
Wilk, Williams, Yamada, Atkins
NO VOTE RECORDED: Patterson, Quirk-Silva, Vacancy
JL:k 8/5/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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