Counties receive roughly $10 billion to $13 billion per year in statewide taxes and federal money to provide mental health care and drug or alcohol treatment. Roughly one-third of the money counties receive to provide mental health services comes from a tax on individuals with high incomes. The act taxes people with incomes over $1 million per year and requires that the money collected from the tax be used for mental health services. The tax typically raises between $2 billion and $3.5 billion each year.
At least 95 percent of MHSA funds go directly to counties for mental health programs and services. The remaining 5 percent of MHSA funds go to the state to support additional mental health programs. Counties can only spend the MHSA money on certain types of services but have flexibility in how those services are provided. The services include treatment for people with mental illness and prevention programs for people who may develop a mental illness. While counties can spend MHSA money on treatment for drugs and alcohol, the people receiving treatment must also have a mental illness.
Proposition 1
Proposition 1 increases the share of MHSA funds the state receives for mental health programs by shifting 5 percent of the counties share to the state. The proposition requires the state to spend a dedicated amount of its MHSA money on increasing the number of mental health care workers and preventing mental illness and drug or alcohol addiction across communities. Since the proposition does not change how the MHSA tax is levied on people with incomes over $1 million per year, counties will receive less funding for existing services.
Additionally, counties would be required to spend more MHSA funds on housing and personalized support services like employment assistance and education. While counties currently can use MHSA money to pay for these types of services, they are not required under MHSA to spend a particular amount. Counties would continue to provide other mental health services under the proposition, but less MHSA money would be available to them for these other mental health services. Examples of other mental health services include treatment, responding to people in a mental health crisis, and outreach to people who may need mental health care or drug or alcohol treatment.
Additionally, Proposition 1 allows counties to use MHSA money on treatment for drugs and alcohol for people without a mental illness.
Amendments to the MHSA will require counties to provide more housing and personalized support services, with less MHSA money for other mental health services.
8.1 Packet Pg. 181
Proposition 1
February 13, 2024
This may result in counties reducing existing programs or using other funds to keep current service levels.
$6.4 Billion Bond
Proposition 1 allows the state to sell $6.4 billion in new bonds for new housing and to build more places for mental health and drug or alcohol treatment. Up to $4.4 billion would be allocated to state programs that build more places for mental health care and drug or alcohol treatment, with a minimum of $1.5 billion for local governments. The state estimates that the bond would build 6,800 places for people to receive mental health care and drug or alcohol treatment at any one time.
Proposition 1 would additionally allocate $2 billion for permanent supportive housing units, building on the existing Project Homekey Program. The housing added by the measure would be for people who are experiencing homelessness or at risk of becoming homeless and have mental health, drug, or alcohol challenges. The state estimates the bond would build 4,350 housing units, reducing the statewide homelessness by only a small amount.
Additionally, Proposition 1 erodes local control and could lead to the oversaturation of licensed drug and alcohol facilities in communities. Under existing law, cities are required to treat most licensed facilities as a "residential use" of property if they serve six or fewer people. Under Prop 1, existing law would be amended for all bond-funded projects to be use "by right" outside of a residential zone, including multifamily residential use, office, retail, and without limiting the number of residents.
The estimated fiscal impact of the $6.4 billion bond is $310 million per year for 30 years, for a total estimated cost of $9.3 billion. The bond repayment would be paid out of the state's General Fund, which has a projected $68 billion budget deficit for FY2024/2025.
ATTACHMENTS:
• Proposed Resolution Opposing California Proposition 1
8.1 Packet Pg. 182
RESOLUTION NO. 2024-02-13-X
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
LAGUNA HILLS, CALIFORNIA, OPPOSING CALIFORNIA
PROPOSITION 1
The City Council of the City of Laguna Hills, California, hereby finds, determines, declares, and resolves as follows:
WHEREAS, Governor Gavin Newsom and a majority of the State Legislature placed Proposition 1 on the March 2024 ballot, which will completely rewrite the Mental Health Services Act; and
WHEREAS, Proposition 1 is a bond and zoning proposal that will erode local control, take away the rights of cities to have separate zoning for substance use disorder facilities, and enrich housing developers; and WHEREAS, this change in zoning would expedite and increase substance abuse and addiction treatment facilities in residential neighborhoods; and WHEREAS, Proposition 1 is a massive $6.38 billion taxpayer-funded bond.
It will cost the taxpayers $310 million annually for 30 years to service this bond. The combined principal and interest will cost the taxpayers an estimated $9.31 billion at a time when the State of California is already running a record budget deficit of $68 billion; and WHEREAS, this bond is expected to build up to 4,350 housing units statewide, which would reduce statewide homelessness by only a small amount; and WHEREAS, the State of California recently spent $2 billion to build more places for mental health care, and $3.7 billion in new construction and for the conversion of hotels, motels, and other buildings; and
WHEREAS, Proposition 1 will divert funding for addiction recovery efforts that serve homeless people to cover taxpayer subsidies for developers to build largescale welfare housing projects across the state, at a cost estimate of up to $1 million per unit; and
WHEREAS, Proposition 1 will strip funds (approximately $140 million annually) currently going to county-based mental health, drug and alcohol treatment programs and give that funding to the state; and
WHEREAS, Proposition 1 does nothing to reverse the disastrous effect of Proposition 47, which greatly contributes to homelessness by making it easier to abuse illegal narcotics; and
WHEREAS, the City Council now wishes to adopt a formal position in opposition to Proposition 1.
8.1.a
Packet Pg. 183 Attachment: Proposed Resolution Opposing California Proposition 1 (3428 : Proposition 1) Resolution No. 2024-02-13-X
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAGUNA
HILLS, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:
SECTION 1. The foregoing recitals set forth above are true and correct and are incorporated by reference herein.
SECTION 2. The City of Laguna Hills is strongly opposed to Proposition 1 because it will significantly diminish community safety and effective county mental health services.
SECTION 3. The City of Laguna Hills is strongly opposed to Proposition 1 because the City stands for local control and fiscal responsibility and believes zoning decisions should be decided by local elected officials.
SECTION 4. If any provision of this Resolution or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Resolution which can be given effect without the invalid provision or application, and to this end the provisions of this Resolution are severable. The City Council hereby declares that it would have adopted this Resolution irrespective of the invalidity of any particular portion thereof.
SECTION 5. This Resolution shall become effective upon its adoption.
PASSED, APPROVED AND ADOPTED this 13th day of February 2024. ____________________________________
DAVE WHEELER, MAYOR
ATTEST:
______________________________________
JENNIFER LEE, CITY CLERK
8.1.a
Packet Pg. 184 Attachment: Proposed Resolution Opposing California Proposition 1 (3428 : Proposition 1) Resolution No. 2024-02-13-X
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss
CITY OF LAGUNA HILLS )
I, Jennifer Lee, City Clerk of the City of Laguna Hills, California, DO HEREBY CERTIFY that the foregoing is a true and correct copy of Resolution No. 2024-02-13-X adopted by the City Council of the City of Laguna Hills, California, at a Regular Meeting thereof held on the 13th day of February 2024, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
(SEAL)
_____________________________________
JENNIFER LEE, CITY CLERK
8.1.a
Packet Pg. 185 Attachment: Proposed Resolution Opposing California Proposition 1 (3428 : Proposition 1) City of Laguna Hills
City Council/Planning Agency
Staff Report
DATE: February 13, 2024
TO: Mayor and Council Members
FROM: Jennifer Lee
City Clerk
ISSUE: Committee Assignment Reports
RECOMMENDATION: That the City Council receive reports from City Council Members on the City Council Committee Assignments listed in the staff report.
SUMMARY:
The following are recent meetings and events attended by the City Council for their City Council Committee Assignments. It is order to receive a report from the Council Members listed below on their Committee Assignment(s).
1 Orange County Fire Authority (OCFA)
Board of Directors
Mayor Pro Tempore Sweeney
January 25 Regular Meeting
2 Southern California Association of Governments (SCAG) Community, Economic & Human Development Committee
Council Member Caskey
February 1 Regular Meeting
3 Transportation Corridor Agencies (TCA)
Council Member Heft
February 8 Joint Board Meeting
9.1 Packet Pg. 186