Assembly Standing Committee on Health

Good afternoon, Assembly Health Committee Informational hearing on the State's behavioral health transformation and implementation and Planning updates for March 4th will begin. I want to thank everybody on the Assembly Health Committee for joining us today.

Today, behavioral health disorders have come to represent a complex challenge for California, the enormity of which is evidenced on our streets, in our schools, in small rural communities and in our largest cities.

Accelerating rates of behavioral disorders coupled with a shortage of available services have made improving California's behavioral health system a priority for this state and we are in the midst of multi pronged behavioral health transformation. Core to this effort is the implementation of Proposition 1, which was approved by California voters in the 2024 statewide primary election.

Prop 1 revised and recast the Mental Health Services act as the Behavioral Health Services act and approved a $6.4 billion Fund $1.0 billion bond to Fund treatment facilities and supportive housing largely through additional rounds of the Behavioral Health Continuum Infrastructure Program, or also known as BHCIP.

Through BHCIP, the state has awarded $1.7 billion to invest in behavioral health infrastructure and will award an additional $4.4 billion in two more rounds of funding. Successful implementation of these initiatives is critical. Recent Reports show that 9% of Californians, that's 3.5 million people in the state, have met the criteria for substance use disorder within the last year.

Nearly one in seven California adults experience a mental illness and one in 26 has a serious mental health condition that makes it difficult to carry out daily activities. However, fewer than 20% of those needing substance use treatment received care and fewer than 80% of those with a mental illness received the treatment they need.

California is making historic investments to address this crisis. The Administration, Legislature, counties, providers, stakeholders and individuals all have a role to ensure this behavioral health transformation is successful and I want to acknowledge that Prop 1 implementation is happening concurrent with several other changes to our behavioral health system in recent years.

But the topic of this hearing is the Behavioral Health Services act and BHCIP. I look forward to hearing from the panelists who have joined us in the Assembly today to provide updates on how the behavioral health transformation is progressing and I look forward to us all working together to ensure that our efforts in this behavioral health transformation improve access and outcomes for all Californians.

Committee Members, I'm so thankful to have our first hearing as an informational hearing and I want to welcome our newest Members to this Committee yet again. We are so thankful for your voice and your expertise and experience in being able to hold these very important and critical conversations for the State of California. With that, are there any Committee Members that would like to make any comments before we begin. Mr. Carillo.

Thank you, Madam Chair. Just want to share how excited I am to be in this Committee, your leadership, looking forward to learning from all of you. And I'm here to see how we can solve the issues that we have in the state. Thank you.

Thank you, Assembly Member. With that, we will begin with our very first panel, which will provide an overview of Proposition 1 and implementation timelines. Will Owens with the LAO will come up and begin. Thank you so much. Thank you. Mr. Owens. Whenever you're ready.

Hello. Good afternoon. My name is Will Owens with the Legislative Analyst Office. Thank you, Chair and Committee, for having us speak. So we've been asked to present on some of the major changes under Proposition 1 and kind of set the table for subsequent panels and presenters.

So today I'll be speaking from a handout that we've provided titled overview of Proposition 1 funding changes and Assessment of Behavioral Health Continuum Infrastructure Program. Later on, my colleague will be presenting specifically on the BHCIP program, which will also be in the same handout. And I'll just be talking about the first few pages here.

So if you look at the first page of the handout for reference, I'll be covering at a high level the role of counties in financing the state's behavioral health system, how Proposition One has changed how counties provide services using revenues from the millionaires tax, other changes to the Behavioral Health Services act, or bhsa, and a timeline of some of the major milestones.

So first, regarding the county role of financing in the state's behavioral health system. So generally, the state's behavioral health system, as far as providing and financing services is split between the state and the counties. The state provides what we would consider mild to moderate behavioral health services or mental health services.

These would be things such as family therapy, and these are primarily funded and delivered through Medi Cal managed care plans. Counties are primarily responsible for substance use disorder treatment or SUD treatment, as well as mental health services for individuals with Low income and severe mental illness.

Again through Medi Cal, California receive roughly 10 to 13 billion annually in state and federal funding to provide these services.

The majority of the state funding is realignment revenues, and about a third of the total funding comes from a 1% tax on incomes over $1.0 million, known as the millionaires tax, which was first established under Proposition 63. The the Proposition that established the Mental Health Services act, or mhsa.

So a big part of the MHSA was establishing categories of funding that counties could use. This revenue from the Millionaires tax for, or as we refer to it as buckets of funding. There were some requirements on what services could be funded from these buckets, but counties generally had some flexibility on the types of services they could Fund.

Following the passage of Proposition 1, these buckets were revised. And how much counties will need to change the services that they Fund from these buckets will depend on what they're currently funding and decisions to be made in the coming year as counties prepare for their planning process.

Now, if you turn to page three, you can see a couple of tables describing what these categories of funding are. So the top table shows the allocation of the funding from the millionaires tax under Proposition 63. You'll notice that about three quarters of the county funding provided under that was for community services and supports.

These are generally what we would consider typical mental health services and can range anything anywhere from outpatient to crisis intervention full service partnerships, including some workforce and training prudent reserves as well. So there were regulations that required about half of this funding to be spent on full service partnerships because it's an important category under bhsa.

I'll just say full service partnerships. These are models of care that are typically called whatever it takes. So it is not just mental health and behavioral treatment, but also is inclusive of wraparound services for individuals who maybe have needs beyond those of just standard mental health treatment.

So as shown in the bottom table under Proposition one, full service partnerships like I just described became their own bucket. And one of the most significant changes was the creation of the housing interventions category. This is a departure from what was previously allowed to be funded under the MHSA. Now BHSA.

Lastly, the final category, behavioral health services supports. This is broadly comprised of much of the categories of like I should say eligible funding that was previously under the community services and supports. So in addition, early intervention program, early intervention programs are also eligible funding under this.

Additionally, wellness centers, outpatient treatment, those types of things are now in this bucket of funding. So that's kind of a high level overview of the funding changes, some of the other major changes.

First, in addition to counties receiving the predominant share of this funding, there is also a Prior to Proposition 1, there was a 5% share of this millionaires tax that went to the state to administer the act. And this was typically used to provide for funding for certain behavioral health services that kind of varied across the years.

Could be workforce development, could be specific initiatives. Under Proposition 1, that state share has increased to 10%, leaving 90% remaining for the counties. However, this 10% is slightly less flexible than the original 5 in that up to 4% it goes to the Department of Public Health for population based prevention.

So that was a category under MHSA that counties provided. That has now moved up to the state level and will be done by Department of Public Health as well as up to 3% for workforce initiatives that will be administered by the healthcare access information HCAI.

The remaining 3% of that 10% will be available to the state to administer the act, likely in similar categories that had been funded before. Another major change was the eligibility for certain populations to receive treatment funded by the millionaires tax.

Previously, if an individual had a substance use disorder, the only way they could be served with funding from the millionaires tax was if they had a co occurring mental health disorder. Now under Proposition 1, an individual with substance use disorder only diagnosis could be treated by services funded by the millionaires tax.

And lastly, there are a number of additional reporting requirements that counties must provide under Proposition 1. Prior to Proposition 1, counties would only be required to report on their expenditures specifically from the millionaires tax. Under Proposition 1 now counties will have to report on expenditures from all sources for behavioral health services.

Lastly on page five, these are just a few of the of the major timelines to kind of expect. So right now the Department of Healthcare Services has released a portion of its guidance on the implementation of Proposition 1 and we expect that to continue to roll out throughout the spring this year.

Then beginning in early beginning in June 2020, or I should say now for through June 2026, counties will be putting together their integrated plans, which is their three year plan to how they intend to spend the Behavioral Health Service Act Dollars. And then beginning In July of 2026, the funding categories that I outlined earlier will take effect.

And then finally in January 2029, counties will be required to submit their first annual expenditure report. So while the integrated plan will include the entirety of the funds use that counties are planning to use for behavioral health services treatment, these expenditure reports will detail exactly what those funds had been spent on and then moving forward as well.

So with that that is the some of the overview of the major changes. My colleague and the following panel will discuss the the bond portion of the Proposition 1, but at this time I'm available for questions. Thank you.

Thank you Mr. Owens. Members, do you have any questions? Thank you. Assembly Member Patel

Hi, good afternoon. As I familiarize myself with the parameters around Prop 1 and the distribution and collaboration with counties, I am curious to know what is the collaboration with our local public school Systems around Prop$1 and ensuring that some of the early treatment that is provided on the school site, although in the school setting is often related to just General behavioral health issues or behavioral health needs. Is there any kind of guidance for counties to provide supports to school districts?

So I'll say that a portion of the behavioral health services and supports dollar amount, which about 36% of county revenues, half of that is or 51% is for early intervention services. And then a further 51% of that share is for. Is meant to target individuals under 25 years old. To the degree that there would be a coordination with local schools and things. I think again it's tough to say right now.

It kind of depends on the county and kind of county decisions moving forward depending on kind of what their integrated plan process looks like in terms of the types of services they would Fund that would meet that kind of early education children and youth requirement doesn't preclude anything.

But moving forward with the integrated plans would be kind of where that partnership would begin to take place, if it hasn't already.

May I follow up in that line of thought? I would love to participate in any ongoing dialogue. I'm a huge champion for youth mental health support services and you know, I've come out of a public school system as a school board trustee most recently.

So I've seen the impacts that the current environment has on our youth and it's devastating. Right now our kids are struggling and with anticipation of cuts to Prop 98 funding, our resources at the school level are going to be diminished further.

And I think this is a great way for counties to collaborate with school systems because we know where those kids are and we can, we can help connect them to services. Also a follow up question. Is any of this going towards creation of new youth specific treatment facilities, treatment beds, that kind of thing, expansion of services.

I'll defer to my colleague on layer panel who will be able to talk a little bit more about what we've seen with the behavioral health infrastructure BHCIP funding to date and as well as kind of maybe what to expect with the bond moving forward.

Thank you. And I just want to acknowledge and welcome Assembly Member Jackie Irwin here who is author of AB 531, which led to this incredible opportunity for us to be able to have the bond funding available for this. Thank you for joining us. That offers us an initial overview. Very thankful for that. And we'll with that move on to panel two.

Our second panel is going to be covering the BHCIP program updates and infrastructure bond rollout. First up, we'll have Ryan Miller with the LAO, followed by Susan Holt, Director of Fresno County Behavioral Health, and Marlies Perez, Community Service Division Chief for the Department of Healthcare Services. Please go ahead.

Thank you. Madam Chair Members. Ryan Miller from the Legislative Analyst Office. If I might just respond quickly to the question that was posed a moment ago. I just wanted to note that there will be future panels that are going to be representing with representation from counties and DHCs.

They may be able to speak more to your question about kind of engagement with school districts. And I do plan to cover the extent to which the bond has been, or rather the BHCIP program has been benefiting children and youth in my presentation. So, still working from the same handout that my colleague was just speaking from.

Starting on page six, I'll begin with some background information on the Behavioral Health Continuum Infrastructure Program or bchip. And then we will also be covering an assessment that our office released about a month ago of the BHCIP program. So starting on page six, the BHCIP program was created in the 2021 budget act.

The purpose of the program is to address a well documented shortage in behavioral health facilities statewide. These facilities provide both outpatient and inpatient services, both for mental health and substance use disorder treatment services. Eligible entities for grants under the program include cities, counties, tribes, nonprofits and corporations.

The awards that were made so far were administered in five rounds of grants. Three of those rounds represent the bulk of the dollars. They were competitive grant awards and that was really the focus of our assessment, in part because it was the bulk of the money, but also because the same structure, generally speaking, is being used to administer the Proposition one bond dollars. The table here on page six details the focus of those grant rounds.

As my colleague mentioned, last year voters approved Proposition 1. Part of the measure approved a $4.4 $6.4 billion General obligation bond. $4.4 billion of that is going to be adding to the B chip program. So combined with about $1.7 billion in grants that were awarded in 2022 and 2023, the bond will bring total funding for the program to over $6 billion in terms of the implementation of the bond.

DHCS was receiving applications in December and they have stated a goal to award about three quarters of dollars as soon as May 2025 and a commitment to try to award all of the dollars by 2026. So turning to page seven, as I mentioned, about a month ago we released a report assessing the BHCIP program.

It's available on our homepage lao.ca.gov for those watching at home. The report assesses the $1.7 billion in grants that were awarded in 2022 and 2023. I think to try to help inform legislative oversight of the bond because the Department is moving very quickly to administer to get those dollars out. We'll be covering four issues in today's handout.

The issues include who's expected to benefit from the bond, findings on how well the awards are, targeting, needs throughout the state, outcomes in smaller counties of the state, and lastly, some potential challenges in the program design. I'll walk through the handout. We actually include some questions for legislative consideration in the handout.

I will say the report does cover additional topics, but we really tried to kind of scope it to cover some of the like key issues in our. In our view.

So I'll start by saying that, you know, given the well documented shortage of facilities, I think it should be recognized that the BHCIP program is building much needed behavioral health infrastructure in the state. We identified some opportunities for improvement in our report, but I think that it's important to kind of start with that overall framework.

So starting on page seven, we wanted to talk a little bit about who is expected to be served by the projects. So. So with the graph you see here on page seven, we found that over half of the projects are estimated to serve at least 80% Medi Cal enrollees.

And we think this is a very reasonable targeting of the program dollars, given both the state's direct responsibility for the medi Cal program, but also that it's been well documented that medi Cal enrollees tend to disproportionately experience behavioral health challenges.

In 2022, DHCS produced a very wide ranging report assessing the State of the Behavioral Health system in California. And they identified three populations of focus for whom disparities and poor health outcomes for people of color are particularly prominent.

So we also tried to assess to the extent the data allowed, the extent to which the program is benefiting these populations. To your earlier question, Assemblymember round four of the grant was targeted for projects that would be serving children and youth and their families.

In addition, we found that, I believe around $70 million of awards that were made in other grants were indicated to be focused exclusively on children and youth. So we were able to estimate that at least 540 million of the $1.7 billion in grants had that focus. So I hope that's helpful.

Our ability to assess the benefits to Other populations was a little bit more mixed. And so that might be one area for questioning as you hear from the counties in the Department. Moving along to page nine, As I said, we had a General finding that we thought that the awards could be better targeted to need.

Now, there are some facility types where the state collects relatively good data and has a good sense of capacity. There have even been some studies that I know Director Holt will cover in her presentation, Looking really at some specific facility types.

But in most facility types, there's limited data to really know how much capacity there are and, you know, whether it's counties or regionally. So we developed a methodology to try to assess the extent to which awards are targeting relative need throughout the state.

And the way that we did this was by looking at relative rates of behavioral health conditions in the medical population. And then what we did was we estimated how many awards we thought the program would make in different regions based on those relatives behavioral health conditions in Medi Cal.

And then we compared the actual award decisions to those projections, and we did find some themes from this. One of them was that in a few regions, we found that awards consistently were either higher than we had projected would be the case or lower than we projected would be the case in most regions. However, it was a little bit of a mixed story.

But as we looked more closely at the way that DHCS has been allocating funding in the program, specifically, they've used a regional funding model where they set aside targeted amounts for, I think, seven regions or so, and then the counties within those regions compete for those set aside dollars rather than competing statewide.

But the methodology DHCS used to determine these regional funding amounts was actually based mostly on historical services provided. And when we looked at per capita awards made in different regions, we tended to find that the ones where we saw more awards being made than we thought or less tended to reflect the per capita dollars that were going out.

So I think that on all that is to say, we thought that changes could be made in that regional funding approach to better target dollars according to what the apparent need is regionally.

In addition, where the state does have a good sense of capacity, and some studies looking at shortages, we found that, and namely, this is for adult inpatient mental health facilities beds. Specifically, we found we made a couple of findings.

First, most of the beds that were awarded seemed to be in the regions of the state that had the least amount of need. And in addition, no awards were made in the region that had the highest need, which was the southern San Joaquin Valley, consisting of Fresno, Inyo, Kern, Kings and Tulare counties.

Turning to page 10, the extent to which the program is benefiting small counties is also a little bit of a mixed story. So a portion of the funding that DHCS sent out was done on a discretionary basis. DHCS was able to target that funding according to, you know, the merits of the, of the project applications or regional needs. And when you look at that, you can see that DHCS really did prioritize small counties.

But when you take a closer look, the amount of dollars that went to small counties were concentrated in 11 of 30 small counties and 19 small counties of the state did not receive any funding in those three main rounds.

So we had raised some questions here on page 11 about what sorts of barriers there may be for small counties to participate and benefit from the BHCIP program. And so lastly on page 12, as I mentioned, we had identified some program design decisions that were made that might be creating some barriers for either small or disadvantaged applicants.

We provide one example in the handout and that was a continued focus on launch ready projects. Now we should say that the original grant dollars that were made had a pretty tight timeline in terms of awards and what we call liquidation or the total expenditure of funds. And so the focus on launch ready projects was reasonable, but it does continue into the bond.

And while there is a clear need out in the state for additional behavioral health services, we are a little bit concerned about the extent to which launch ready project, the extent to which scoring preferences for launch ready projects might make benefiting from the program harder for some applicants.

And that's because a great deal of time, resources, staff really is needed in order to put together a very compelling launch ready project. We also found that conceptually the focus on launch ready projects might make it more difficult for the BHCIP program to be building out some of the harder to site or harder to build facilities. So that concludes our presentation and we're available for questions. Thank you.

Thank you so much. We will now move to Susan Holt, Director of Fresno County Behavioral Health.

Thank you. I'll be speaking today from PowerPoint slides. I believe those are being loaded and I want to take this opportunity to introduce myself. As you said, I'm Susan Holt, the behavioral health Director in Fresno county where I have spent all of my life.

I've never lived outside of Fresno county and I've been the behavioral health Director for three years but eight years as a Deputy Director. And I'm proud to say I worked my way up through the ranks. Started as a pre licensed clinician. I'm a licensed marriage and family therapist.

It's really an honor to be here today, and my role is to provide the county behavioral health perspective on the BHCIP grants process. On behalf of my colleagues and my community, I want to thank the Newsom Administration for this historic investment in one time funds long overdue infrastructure investments.

The public behavioral health system truly is that it's a public system, and we have for quite a long time, in fact, been restricted in a methodology of payment that intentionally did not permit us to profit. And so thus we were almost wholly reliant on grants in order to build out brick and mortar infrastructure capacity.

And so, as you've heard, the capacity needs are quite significant. I think that you see from the prior presentation that there was an oversubscription in grant applications, so the demand has been significant as I work on my technology skills to advance the slides. My apologies.

I'm going to ask my colleague from DHCS to assist. No pressure. We have excellent collaboration with dhcs. I'm proud to say this is a demonstration in action. Madam Chair, would you like me to pause? We will figure out a way to help advance. Thank you. Technomagic. Thank you. Excellent. Thank you so much for the support.

So, county behavioral health directors have long had an interest in ensuring that we do have the appropriate range of facilities statewide.

And so back in 2020, as we were reckoning with the challenges of accessing the scarce state hospital beds for our most acute patients that we serve, we commissioned RAND to do a statewide analysis of inpatient bed needs in order to validate whether we needed additional inpatient bed capacity and then further to quantify that and to demonstrate where that need is.

This part of the continuum of care is, as I mentioned, for our most severe individuals. And this is important, critically important, not only for their own well being, but also to address the flow of patients coming out of our emergency departments across the state.

RAND has been an excellent partner for their deep understanding of our specialty, behavioral health system, as well as their rigorous approach to policy and data analysis.

As they were conducting their study, RAND determined that we could not view inpatient bed capacity in a vacuum or in isolation because the capacity is determined by the availability of additional step down beds. So they expanded the scope of that study to include not just inpatient beds, but also subacute capacity and community residential beds.

In other words, the case could be that a community had the right number of inpatient beds, but if there were no step down subacute facilities or residential facilities, then we would have a bottleneck in those inpatient beds. And so that was the reason for the expansion of the scope in the study.

Those lower levels of care are really critical to ensure that people receive the right care at the right facility type for their progression in their recovery. I do want to be very clear. It's highlighted on your slide that this study was limited to the adult population.

As my colleague from the Leo was addressing the analysis, that bed capacity was quite complex. And so for the purposes of this study, we restricted that to adult inpatient beds. This study did not factor in youth capacity, nor did it factor in residential care, substance use disorder capacity, or any outpatient treatment capacity. Next slide, please.

Does it work now? We will try if I know how to do technology success. Thank you, Madam Chair and Members, for your grace. So this slide is describing the analysis from that RAND study. This was published in 2022 from the work that preceded it temporally.

So they needed to establish a new tool to measure inpatient capacity and need. Questions about inpatient capacity have been asked previously. This has long been a concern of behavioral health directors, DHCs, and many other stakeholders as well.

But it was important to create a methodology to look at needs consistently in a uniform way, and rand was able to look by region as well as by level of care. In their study, they did find that the northern and southern San Joaquin valley, my home, was the areas of the greatest need across all levels of care.

In addition, it was an area identified with an estimated very high growth of of that need. So RAND also found that even when beds did exist, Given the demand for those beds across all payers, not just medi Cal, county behavioral health agencies often struggle to find providers willing to take the individuals that we serve.

We serve those with the most significant impairments from serious mental illness, and sometimes those individuals were hard to place in facilities because of comorbid physical health conditions, Co occurring substance use, histories of justice involvement, sometimes significant justice involvement complexities such as a history of arson or sex offenses.

All of these complex variables, as well as the clinical complexities of serious mental illness, made it difficult for counties to find beds even when they did exist. Keep in mind, private facilities often are not under any obligation to accept the individuals that we are mandated to serve in county behavioral health. Supply and demand, right?

So we know that when beds are in short supply, individuals with less complex clinical needs and less complex discharge plans, Just as an admissions coordinator, you know, the water flows downhill in the path of least resistance. And so that's not even factoring in medi Cal rates.

Looking into the next slide, RAND did come up with some recommendations that I'd like to highlight for you. Three significant recommendations, and these were for both us at the county level as well as our colleagues at the state. Recommendations to consider included prioritization of bchip funding and other capital infrastructure funding Based on the greatest need by both level of care and region.

They emphasized a second recommendation of building or remodeling infrastructure specifically for that very hard to place population served in the county behavioral health system as I described, and investing in a system to review licensure data, periodically collecting facility level information.

So counties, myself included as a representative of Fresno county, We leveraged the information that we learned through the RAND study in our applications for the BHCIP process.

And again, because that study did have limitations, Some county behavioral health directors even commissioned further county specific studies through rand using the same methodology as they prepared their applications For BHCIP rounds, we did share our RAND study findings with the state, and we used the state's results to determine gaps at the county level and make decisions about which types of facilities to apply for and submit in the BHCIP applications.

So just like everyone else in the state, we were very curious about how everyone fared. And so we commissioned an additional independent analysis of those competitive rounds, rounds three through five. And what you see here on the slide is that counties were the recipients of just barely over half of this awarded funds, 51%.

And then what you can see here on this next slide is that we believe that that is to some degree a function of the increase of county funding in the fifth round. So the two prior rounds were a little less so on average about 51%.

We were also curious to see how much of the awarded funds were tapping into those needs that we saw identified in that RAND step study. So these results are across all grantees, not specific to counties. And as I mentioned, this is only specific to adult population because that was the limitation of the RAND study.

So this is specifically related to acute inpatient adult beds. Now, while some of these numbers are modest, the point of this slide is to share with you. We still have great work ahead. We have much farther to go to build out the infrastructure in the highest end of the treatment continuum.

But yet this has been a very impactful investment across the state. And we as behavioral health directors remain quite grateful for that. So since you have me here from Fresno, I'd like to take just a brief moment to zoom in a little bit to speak to my experience as a behavioral health Director.

We were so excited to take advantage of this historic one time investment in our infrastructure. So in Fresno county we got busy and we submitted a total of nine applications across the three rounds.

In total, that was $104.7 million worth of applications, really critically looking to support the needs of that southern San Joaquin Valley that was highlighted in the RAND report. Unfortunately, we have $0 from BHCIP in spite of valiant efforts by our team.

Seven of the applications, 68.3 million, were for acute care beds such as psychiatric health facilities and crisis stabilization unit, which were particularly highlighted in the RAND report as critically needed. Nearly all of the requested funding was for acute care needs in our region and outside of county applications in Fresno, there were eight other applicants.

One did receive an award and that was a tribal entity, but no beds. That was a wellness center and an outpatient treatment facility. I do want to note, it's important to say that we did receive A tentative award notice in round five.

But how we ended up there and why we ended up having to not accept those funds I think is reflective of the complexities of the process. Because we are a poor county, we are critically in need of infrastructure and we applied for the both adult and youth facilities that we knew that we needed.

We had people stacked up in emergency departments. We have critical infrastructure failures where we need to replace facilities. And we were so perplexed as to why our applications were not funded. We felt that they were highly competitive and they were certainly reflective of the need.

So in the last round, in addition to applying for the facilities that we knew we needed, we thought let's get creative and pardon the expression, but it was a little bit like being blindfolded and spun in a circle and really hoping you could get that tail at the party on on the wall. We did.

We did receive the tentative award, but a calamity of errors happened in which the building that we were going to renovate burned down. The property ended up with some title problems and we were unable to get the entire property to meet the very strict requirements of bchip.

And complicating matters even further, in our valiant effort again to put together an application, we had preliminary cost estimates. And as our colleagues from Public Works and Planning were able to deliver documents after the submission with more detailed budgets, the actual cost to renovate that property would have grossly exceeded what we requested in the award.

And so for those reasons we were unfortunately unable to accept the grant award. So I did want to clarify that when I talk about $0 for my region.

Lastly, as we look ahead nearly lastly, we have some priorities that we based on CBHDA analysis grounded in that RAND study, we would like to offer some areas of focus for our colleagues at the state and the Legislature to think about.

BHCIP Obviously I represent the San Joaquin Valley and the southern San Joaquin Valley in particular has critical needs as well. Inland Empire, Bay Area, Central Coast and importantly, I want to flag that in conversation with behavioral health directors. Our colleagues in the rural northern counties are often lumped in in the region where Sacramento is.

But geographically and from a practicality measure, delivering clinical care that may not make the most sense. So I really want to emphasize the rural Northern California county needs are often masked in the way that they are grouped regionally. So a few other considerations as I wrap up my points.

I would like to indicate that as we move forward, you heard the overview of BHSA and the focus on substance use disorder services, as well as the importance of Integrating both mental health and substance use disorder.

With all of the policy changes that have been passed recently, we strongly encourage the state to make it a priority to focus on substance use disorder capacity and that capacity to treat co occurring disorders in the same facility.

Leveraging the strengths of the behavioral health system, recent new laws passed like Proposition 36, SB 43 and Proposition 1 have placed a very high, much higher demand on counties to provide substance use disorders and integrate those services with mental health. And that comes with both policy and clinical practice challenges and opportunities.

And lastly, SB 1238 was signed by the Governor which does give us the option to bring in substance use disorder services into existing Lanterman Petra's short designated facilities, which we're very grateful for. But that infrastructure funding would be critical to be able to deliver on that. We also need some support.

We're super grateful, as I mentioned, for the collaboration with the state and we want to make sure that there is capacity for the siting at the local level and the licensing at the state level for these new facilities.

We do not want to end up in an unfortunate situation where we have buildings ready and staffing, but no license to operate and have folks lingering in inappropriate levels of care. So we know that our colleagues at the state may need to staff up for the demand.

The next item I wanted to highlight a little bit is that some counties did receive awards, but they were funded at levels significantly lower than the application submitted.

And so this could present a complication for counties to be able to execute an infrastructure project if they are not able to, to source additional funds to make up the difference. And then last but not least, workforce. We, I think we all know that across industries there's workforce shortages in behavioral health.

The workforce shortages are every day impacting the lives of Californians. And we want to make sure that as our state has those workforce dollars, as our colleague from the LAO described, we want to make sure that we are considering how we can successfully match the needs of the communities with the facility investments.

And then service dollars also is in conclusion a critical need. So as we build out facilities and then hopefully we're able to recruit and retain, there's no new service dollars. And so it's having buildings and having bodies but no paychecks will compromise our ability to deliver the services.

We are grateful to the Legislature, we are grateful to the Governor for the historic investment. Again, clearly you hear my passion and you've heard the reports of the pent up demand in our system of care.

We are sincerely grateful for the partnership with DHCS and acknowledge the heavy lift of managing these very complex projects, from the grants application all the way through to ribbon cuttings. One thing we hope to do is to draw on the information that we know we believe in quality improvement in healthcare.

And so we're hopeful that our remarks today are helpful in improving the allocation process. And on behalf of my colleagues across the state and my community, thank you so much for the honor of being here today to tell our story.

Thank you. And we're going to let our last panelist, Division Chief with the Department of Healthcare Services, Marlise Perez, present, and then we will have a round of questions after that.

Great. Thank you so much. So I'm Marlies Perez. I'm with the Department of Healthcare Services. I've been at the state in behavioral health since 2001, and I've been really fortunate to be able to be the lead over our BHCIP project.

And so I'm really excited just to share a little bit about some details that our colleagues at the Leo might not have been able to have time to share, but also to respond to some of the recommendations in the report and of course answer any of your questions as well.

And so I think it's important to note that with the $1.7 billion that we have already awarded, that is funding 223 mental health and or substance use disorder facilities. And what's important about that is there can be multiple facilities on like a campus or with a provider.

And I'll talk a little bit about that in just a moment. We're not going to spend much time on it. But I do just want to also highlight in round one of BCHIP was for mobile crisis, and that was part of the legislation designated 150 million for expanding mobile crisis teams.

And so with that funding, we have expanded over 400 mobile crisis teams. So I wanted to mention that.

And then just briefly touch on Round two was a planning grant phase because we recognize that our county partners and our tribal entities, maybe they didn't have a really robust infrastructure plan, just as my colleague here from the county has stated, they haven't had the funding. So we wanted to give them.

It was a small amount of money, but it gave them an opportunity whether to hire consultants, put a plan together, hire someone to help write some of the grants. So they had that available as well. But the bulk of what I'm going to talk about today, just as is in the LAO report, is rounds three through five.

And then I'm going to touch a little bit on the bond where we are and where we're going there. So when we were looking at the BCHIP Dollars, we really wanted to ensure, just as has been highlighted today, that we had a really robust regional approach.

So we really put some effort and time into thinking how can we, you know, make sure that the funding is adequately and geographically distributed across the state, which is quite a challenge in a state like California. But also even looking within counties, because there's in a lot of counties there can be really rural pieces and urban pieces.

So we modeled after some other infrastructure programs in California and that's how we came up with the allocation and the regions of funding.

But as was noted, we also wanted to ensure that we had a 20% discretionary part of the funding so we at the state could see if there was an area that had a higher need or a facility that really met a geographic need, a regional need, that we'd have the ability to make those awards.

And then also we did a tribal set aside because as you look at the rates, especially of opioid use disorders and suicide completions, unfortunately our American Native and Alaskan population have the highest rates. So we really wanted to ensure that they had some dedicated funding that they could apply for.

I also just want to state, this is sort of my little disclaimer up front. Unfortunately we can only award who applies. So that has been a challenge that I'm going to discuss a little bit later of what are some of the barriers that keep especially some of our smaller counties from applying.

But just recognizing that, you know, in looking at our DHCS assessment, the RAND assessment and even local assessment, you know, folks have to be able to build an infrastructure, you know, that has to be in play for 30 years, which is quite a responsibility.

So we have been looking at ways to help those that maybe have struggled in order to make that happen. And then as was mentioned, we have been focusing on launch ready projects and that has really been for a few reasons, as was mentioned, the timeframe that we have to expend the funds.

Also we have just such a dire need in California to get these facilities up and running. But also that is just one area that we consider when we're making awards. So I do just want to highlight. We're looking at the various construction types. We're also looking. Is it like a ground up construction or a renovation?

We're also looking at the population of focus and I'll talk a little bit about those key areas of population focus. And I want to be very clear. We funded many projects that aren't launch Ready and some that were a little bit perhaps riskier than others, but they served such an important population.

Or maybe it's the first facility type that this county has had or we've actually even funded the first CCRPs that the state has even had and PTRSS. So all of these things are taken into consideration.

We're also looking at the construction costs for comparable facilities, Recognizing there are different costs depending on the regions, but really ensuring that they aren't over prescribed when they're asking for these costs. I think another really important piece that is the letters of support.

So we do require letters of support from the county behavioral health Department, but a lot of our applicants also submit tons of letters of support that you really can gauge. Is there community support? As we know there's a lot of NIMBY issues for our mental health and substance use disorder facilities.

We have unfortunately experienced some siting issues and struggles with some of our projects. But seeing what type of support at the local level for this facility, because if there are issues in that neighborhood, you know, are they going to have the support in order, you know, to complete the project?

We're also looking at the location of the project, the area served. Also what are the current facilities in that area as we don't want to just build the same type of facility right next to one if they already have that. As was mentioned, Serving the Medi Cal population is a large focus.

And while a majority of the projects that we funded have a very high percentage of Medi Cal Members that are going to be served, we have funded projects that have less than 20% of Medi Cal individuals being served, partly because they had a very unique population of focus, whether it was the justice involved, that perhaps they're receiving funding from our partners at CDCR or other type of funding for the justice involved.

So these projects also have had very high degrees of community support. And also some of these projects may be in a campus setting that has other levels of care in that model as well. So I do want to talk a little bit about because I know there's been interest around the children and youth.

So as was already mentioned, we have awarded over 772 million in 71 projects that have a focus on children and youth. And what that means is the facility type itself serves that population. It doesn't mean that other projects aren't serving children and youth because there are ways that that can happen, but these are specifically for that population.

We have also awarded over 70 million to tribal entity projects and that is supporting eight different projects. Across the state and then for our justice involved population, 85% of the projects state that they will serve the justice involved. So we're really excited to say to date there are 19 projects that have been completed in 2024.

So that's about 15% of all of our projects. 47 projects are going to be completed in 2025, 48 in 2026, and then the remaining 16 projects in 2027. So as of last month, we have seven facilities that are open and providing services to their community.

The projects that aren't quite open yet are working on their final details, whether that be their license and certification or getting their furnishing furnishings or things like that. The next thing I want to talk about is the small county impact.

And so as was called out in the LAO report, the balance of state region, where a lot of our small county partners are, received about a quarter of the discretionary funding from DHCS. We do note that there were 18 small counties that did not receive any funding from rounds three through five.

However, out of this, 16 of these did not apply. And so, however, some good news. Seven of those have already applied in the bond bchip round one. So we're really excited that they have put their foot forward and are able to provide an application.

So we're going to continue to work with these small counties that either haven't been awarded or haven't applied for our bond round two funding. And some of the reasons that we have been, you know, hearing from our county partners and surveying them and working with them is just a lack of staffing or workforce.

They potentially may have had turnover at the county level. So maybe a new administrator, a new staff, so might not have been familiar with the project or the opportunity or just had an overall workload issue that they weren't able to apply.

Also, sometimes having feasible site locations due to land costs, environmental conditions, or just not having available property, whether it be county property or something that they could purchase, sometimes they had unmet needs or better aligned with other initiatives.

And then also sometimes the risk of because once again, these facilities have to be providing behavioral health services for at least 30 years, sometimes that risk was just too great versus the potential of return. So next I want to move into the bond.

So as was already mentioned, DHCS will be overseeing $4.4 billion to really just augment the BHCIP program. And as the LAO just briefly talked, I have to talk about our sister Department and the Housing Community Development Department. They'll be uplifting up to $2 billion. And that's for infrastructure around housing.

So just want to make sure that that's clear, that our partners are working on that as well, with about a billion of that going to veterans housing, all for individuals with behavioral health conditions. So related to our bond BHCIP funding, last July we announced our the release of our request for application for our first round.

So that will be awarding $3.3 billion. We've also been holding before that public listening sessions, excuse me, and also releasing initial policy guidance. So anybody that was interested in applying would see the parameters and so they could get prepared for that RFA release.

So of that $3.3 billion that we will be awarding, 1.5 billion is dedicated, and this is from the statute to our counties and cities. And Then also there's $30 million that's designated for tribal entities. The remaining 1.8 billion will use that regional funding model as we have in other BHCIP rounds.

And so I also just really want to talk a little bit about some of the lessons learned through the standing up of BHCIP and what we have applied to the bond. So we have been really looking from our stakeholders, working with our county partners and other stakeholder groups to see how we can improve for the bond.

So as I mentioned, we've been providing a lot of technical assistance in areas that have not received BHCIP awards or perhaps they didn't apply for a facility type that was eligible. So helping gear them towards, you know, an opportunity that may work better for them or for applications that just didn't meet the minimum requirements.

Because we are really wanting to ensure that we are awarding projects once again that can be completed and that, you know, that is extremely important to us. So maybe they didn't quite get there. And so we've assisted them in that space. Space.

So we're happy to state that this has resulted in a significant increase in applications received from rural counties and applications in the San Joaquin Valley regions.

We've also been increasing in the application process, better identifying that cost per facility and that type and that bed slot count we've also been really looking at, because of that 30 year requirement, we recognize that needs at the county level change.

And so we've instituted a process that for our awardees, if, let's say in five years, they need a different facility type or they, you know, need to adjust it, they can come to the Department and we can review and approve that as long as it's meeting that local need. And of course is still serving behavioral health individuals.

We've also been working with our county partners to ensure that there's no additional local submission processes or requirements because we it is still a competitive process. We want to make sure everybody has an opportunity to compete for the funding.

We've also instituted an in depth analysis during our application review process that has data metrics including but not limited to our DHCS needs assessment, the RAND study award, patterns in the region, existing behavioral health facility types, and once again looking at those local support, whether it's through letters or other ways of support.

We're also continuing and we'll continue to look at ways that we can reduce the Administration burden on those while they're applying, but also throughout the BHCIP process.

I do have to state though with the bond there are some additional reporting requirements that just comes with bond funding, but we're looking at ways that we can make that as easy as possible and as clear as possible for our awardees. One of our most significant delays though in BCHIP has been the execution of the contracts.

And some of that has been due to a lot of back and forth with redline revision requests that we've received from multiple projects. And so what we have done is back in 2024 we have been working with our county partners, we have shared our contracts, we've had several meetings, several revisions back and forth.

So everybody knows up front these are the agreements that you're walking into. And so for all of our bond BHCIP awardees that receive a conditional award in May, they're also going to receive the copy of the contract so they can decide, yes, this works for me right up front and I'm willing to proceed with the award.

And then we are requiring that that contract be executed within 90 days so we can just shorten that time frame and get to that construction. That's really important. So as I mentioned, the round one applications for bond BHCIP closed in December. So we received a total of 294 applications and that request was a total of $8.8 billion. So it is, the need is high.

I also want to state for rounds 3, 4, and 5, we had received far over the applications than we could award, which is really painful to hear as I'm sitting next to my partner here from Fresno County. We can't award as high as the need is and that is just the unfortunateness of the situation.

But we are excited as we're, you know, starting the review process. I personally get to review all of the BHCIP applications, which I love, but it's also really, really hard because you have to make some really difficult decisions.

But once again, we really look at that local need and rely heavily on that to see what the locals need the most in their area. So we are going to make our announcements in May in just two months. Really excited about that. And then our round two will be up to 1.1 billion.

And we are going to be releasing that RFA also in May. So we are excited about that. And then those awards will be anticipated in spring, spring of 2026. And then I do just have a few quick slides. I don't know if someone can pull those up. I really wanted just to give. I know some of you Members are newer to BHCIP, so I wanted just to give you a little flavor of what we're awarding.

I think we have the photos. They're primarily photos of the different sites in our packet. So I'll leave it to Members to look at that and if you have any final comments, that would be great.

Yeah, I think the only thing I'd like to highlight in your packet. So the Riverside project. This is a campus model. You'll see all the various types of licenses that are available in this model. They actually just had their topping out on February 19th where they put their final beam. That's that second picture there.

So that's very, very exciting. The second picture is Cry help. I just want to note at this facility, this is a substance use disorder facility. I know it's mentioned the need to expand these. This opened in February, but prior to opening there was the. The fire down in the area.

And they actually used the facility before it was open to house 100 patients that were at another treatment facility that were evacuated. So it was a really great showing of solidarity, but also great use of the BCHIP facility. Luckily, that facility, there weren't any damages, so they were able to return. But this facility is up and running.

And then the last one is for mental health outpatient services. Just recognizing that with bchip, we're looking at the whole continuum of care because that's what's really needed in our communities. The places where individuals can get the care that they need at the least restrictive setting. Thank you.

Thank you, Members. If you have any questions, I know Dr. Arambula had one. And then we'll go to Assemblymember Irwin.

Thank you, Madam Chair. I'll begin if I can. Underscoring the tremendous need that we have for facilities across our state, I do have my first question for Mr. Miller regarding whether or not we are addressing resources towards the areas and regions of our state that appear to have the greatest needs.

My concern oftentimes is when we base it off of historical services that we oftentimes are baking in historical inequities and disparities that currently are in our system.

So as we're trying to design a healthcare system that's more equitable, we should be looking towards what the RAND study is indicating, which is a need for BHCIP funding to be following. Need. And so my first question is, if we're expecting the same structure from Proposition 1, shouldn't we expect similar results?

How do we make sure that we are applying appropriate strings and oversight to demand that resources are going to the areas with the greatest needs? I was encouraged by the Administration and the forward looking policies regarding Ta or advice regarding how to apply for funding braiding of funding that's needed in this space.

But will that appropriately allow us, with the remaining 2/3 of BCHIP funding that we have, to be able to start to invest into regions of our states that have historically been left behind?

Thank you, Dr. Arambula. Yeah. So I would start by acknowledging, I'm sure that Ms. Perez can expand on maybe some of the other approaches that DHCS uses in assessing grants to try to gauge community need. But you know, both were the RAND study was concerned on adult inpatient mental health beds.

And then the way that we assessed essentially other facility types, we did think that the funding could be better targeted. Now, I don't, I wouldn't say that that means it's necessarily poorly targeted.

But in some of the regions of the state, Los Angeles comes to mind, where I think in, in all but one facility type that we assessed outside of the RAND study, that is Los Angeles County, we found had received more grant awards than our methodology would have predicted. Similarly.

But conversely, in the Inland Empire, we found the reverse to be true, that they had received fewer grant awards than we had expected. So I think that, you know, with DHCs continuing to use the realignment methodology as the way the funding is going out, I think that at least as far as our assessment is concerned. It.

Would probably just depend on the extent to which some of the improvements that DHCS is making would kind of help with that, I guess. But really the funding really is anchored by that initial regional set aside. So I guess I would say that the extent to which those improvements will help will be somewhat limited by that structure.

I do want to uplift if I can, Director Holt, for your tenacity in continuing to apply and to put Fresno out there and to ask because of the tremendous need that we have and the willingness from the Administration to work with all regions of our state allows us to not have a one size fits all and look forward to how the remaining funding can appropriately be appropriated.

But many of us are going to want to make sure that we're tracking and following closely to ensure that ultimately we're getting the results out of these dollars.

It should just be said, for the public's sake who voted for this, that we are able to deliver results for all parts of our state, that everyone who was there to support this Proposition that barely passed, that every region of our state is there to receive resources, should be the message that we're also able to deliver.

Thank you, Assembly Member Arambula, Assembly Member Irwin

Thank you very much Chair Bonta and.

Can you hear me? Yeah, it's on. Can you hear me? Thank you, Chair Bonta. I do appreciate being able to join you today. It's obviously you can't hear me.

I think if you speak closer to the mic, we'll be able to hear you. Can you hear? Yes.

All right, I will lean in a little bit. So this is really to follow up, Dr. Arambula, and also to acknowledge that the public was very skeptical about approving any more bonds. They've been skeptical about the way the state has spent money in General. So there were promises made.

And the first one was that the money get out quickly. The second one was that we would make sure that we had accountability measures because we understand the anger at where some of the homeless funding went. And then third is really that the entire state does benefit.

There are a lot of areas that are outside of the major cities that do not have the technical expertise to quickly put together grants. And so I think, as you mentioned, LA has received. I mean, they obviously have a huge population, but potentially a disproportionate amount of the resources.

And I think we really need to look at the entire state. So I just have a couple of questions on those three things. In your opinion, and I don't know if it's the LAO or Director Holt. Do you think that the administration's BHCIP implementation has been too aggressive, or is it. And I'm talking about bond BHCIP , obviously, or are the goals realistic?

I think that's a very difficult question to answer. Just to be fair. You know, I think that, like we had, like we had said at the beginning of our presentation, that I think there's almost like, universal need, a recognition of the need that's out there.

And in light of that, I think it's difficult to say, you know, slow down. But that said, I think that our review demonstrates that there are some either geographic regions of the state or perhaps some types of providers that maybe are being left out.

That's a really difficult tension, I think, to sort out and to find a right answer. So, unfortunately, I don't know that I can give you, like, our sense of the right answer to that, but I think our hope is to try to illuminate some.

Some of those program findings and trends and help you be able to ask the Administration and counties about that as well. So they may be able to share some thoughts, too.

Assembly Member, thank you for the question. I think I share the thought that it is hard to answer the question. There is, I think all county behavioral health directors approach Our work with urgency. We know every day the people that we serve are those who have significant need across California.

Many of us were, you know, as soon as the applications released in the first rounds of BHCIP, we were right there trying to figure it out. In Fresno we had launch ready projects for adults and youth. And it is, it is a very complex application process.

I will say that and I appreciate the comments from DHCS leadership indicating the lessons learned to date.

The moving this money out fast does come at a cost because there will be some who are left behind because they don't have the internal capacity to put together the application or they don't have county owned property or a property owner willing to enter into the types of agreements that will allow a BHCIP application.

The other thing I think that complicates our world is many counties deliver care with our own wonderful clinical workforce who are employed by the county and contract with other organizations to deliver care on our behalf. And those contract cycles are usually five year contract cycles in county land.

And so thinking about, you know, letters of support, for example, we were told, you know, in order for anyone to apply, they have to have a letter of support. But then we're also told we can't put any restrictions or parameters or qualifiers on that. And so to be perfectly transparent, I wasn't going to turn anyone down.

So everybody who asked me for a letter got a letter because I'm simply saying this is the need in my community. So those are the things that make it really complicated to answer the question. I can speak with conviction and assurance that we understand the urgency.

And yet sometimes for this much money in a complex environment, sometimes we need to go a little slower in order to go faster in the end.

And I mean just emphasizing what you said there, I think these three goals that I talked about or that we had talked about while we were trying to get the Proposition passed are somewhat in conflict because the large counties probably have a lot of shovel ready projects and the small counties are the ones that you know, might be along the way but don't necessarily have shovel ready projects.

And, and so, so it is a balancing act. But I, I guess from Ms. Perez you said there were some grants that that would help with planning. But do they actually get these small counties or these mid sized counties that are near big counties? Do they actually get them to the shovel ready point in time to, to get in line for the, the bond beach it?

Yes. So we've been really excited to see the plans at the county levels and then which of those have received awards and also with the bond as well.

And I do just want to be very clear as while we are really encouraged when there's a launch ready project and a shovel ready, that is just one thing that we're looking at. And we have awarded most of our grants have not been shovel ready. There's various phases that we ask that they do meet.

Like we do want to make sure that they have a site identified or you know, because we can't start that far back to where it could, you know, take 10 years for a project. But we've also awarded, you know, a lot of our smaller counties or rural projects.

The grant applications aren't always the best, but we still make the award based on the need. So I just want to be clear.

We've really looked at that, you know, and weighed that and you'll see as like the LAO said, we've our discretionary funding, a lot of it went to our small counties and also our tribal entities because we saw where the need was.

So I just don't want it to appear that like we're only, you know, awarding the shiniest applications. That's not the case. But also it is a tension of how many more awards that, you know, we would love to be able to give if there were the funding.

And we also see entities that apply in one round, don't get it and maybe awarded the next. And we are seeing that also with the bond BHCIP as well.

And then I guess that again goes again with the tension of accountability when you are, when you are awarding to counties that are not quite ready, you're not sure that you're going to get the outcome you want.

So could you just, and this is my last question, could you just briefly talk about the difference in accountability for the first five rounds of BHCIP and then the bond BHCIP , how are the taxpayers going to know that their tax dollars are being spent wisely?

Yeah. So great question. Thank you.

We have really increased our accountability measures through each round of awards because as important as it is to meet the need locally of the awards that we make, we really want to make sure there's nobody that is fraudul using this funds or even with the best intentions not able to complete the project.

So these, we are looking at a plethora of different things that we have like our medi Cal fraud lists or you know, we do, we require pulling of the deeds. We pull the deeds twice. We look and see what are the deed restrictions.

You know, we're looking for any sort of potential risk even after we make the awards. We've had many county projects in particular have to change sites and move locations and we've worked with them to, you know, start up again and go through the process.

But then we've also had to look at, okay, you're getting close to not being able to actually complete the project because we want to make sure all the funds can be expended. So there's just various accountability measures that we've put into place in rounds three through five that we've moved over into the bond as well.

And really also ensuring with the bond when we make these awards, there's going to be a higher degree of transparency for the public as well to see, you know, not only where the awards have been made, which we have, but what has been the expenditure level, because that is something that is required to be reported with the bond as well.

And how far are projects along in completion? We have been cautious with rounds three through five because of the NIMBY issues. We have some projects that have been fighting quite extensively locally because some of the local entities don't want those projects in their area.

So we're cautious and especially for our children and youth site of putting out the addresses until the projects are complete because we've noticed that there have been some tensions that have built around in certain areas. So we're careful on the accountability from the lens of ensuring that the project is, is held accountable. But we want to be accountable to these projects as well because we need these facilities.

Thank you.

Thank you, Assembly Member Irwin. Assembly Member Carrillo.

Thank you, Madam Chair, and thank you for the presentation. My comments and questions are also aligned with what Dr. Arambula and Assembly Member Irwin discussed. Mr. Ryan, you. You mentioned that there was focus on small counties. Appreciate that.

And then the discussion on large counties, like in LA County being a large county, but there's also rural areas within the county, areas that I represent at the Antelope Valley and portions of San Bernardino. County.

So my question is, once that allocation is given to a county, is it only within the county's jurisdiction or discretion to apply how those funds are distributed?

And the question again is because the north LA County rural and it's lacking access and the way to get to specialized services is by getting down to down below the hill, as we say up there, which can also be very challenging because of transportation issues.

So the question again, is it just within the county's own discretion to see how this gets distributed? And I realize the grant process and the application process and those things Too, but also Ms. Perez, mentioned that there is a 20% discretionary funding. Is there an opportunity for that to be applied towards rural areas?

Thank you. Yeah, so I can start. And it sounds like DHCs may be able to add on as well. So in terms of your question about the regional funding and how it works with counties, there was one region that was a county and that was LA County.

And then aside from that, the counties were grouped of multiple counties. And so one would be say, for example, Southern California, which I believe was Orange, Ventura, San Diego and the Inland Empire in General. So that was kind of one big region.

So I think the answer to your question depends a little bit in terms of whether, you know, we were talking about just LA County or just the others. But I would expect that, you know, the discretionary portion of the funding that 20% that Ms. Perez

detailed earlier is one way that DHCS can probably get at some of those issues too. But you know, say within even Los Angeles County, applications would be coming from both the, you know, the county Behavioral Health Agency, potentially other departments within Los Angeles, you know, individual providers, tribal entities.

The letter of support process that was discussed earlier is one way that DHCS has gauged kind of some of these issues that you're getting at in terms of the different nature of communities within a county or a region. So, and perhaps DHCS can expand a bit on that.

And just to clarify, I apologize for not being clear earlier, but who's actually applying? Or the providers themselves, themselves from these counties. And I was trying to look, I can't remember. I think there's somewhere between 17 to 20 different provider types of both mental health and substance use disorder facilities.

So the providers are committing to doing these services for 30 years. Now some of these, as was mentioned, are counties themselves. Especially in smaller counties, they do the provision of the services themselves, whereas other counties may contract with providers. So just want to clarify on that.

So the money doesn't go to the county unless they received a grant for their project. In your packet is Riverside County. They actually, this is a county owned facility. So in that instance. But those other two facilities are like providers themselves of the types. I already forgot the second question. Sorry, what was your second question?

No, I think that that answers the. Question if I answered. Okay, great, thank you. And Ms. Holt, you mentioned the Dr. Arambula noted the tenacity and you applying, continuing to apply for applications in rural areas.

And maybe some of that challenge also has to do with the way the applications are structured and how they favor highly urbanized areas like La, San Diego, San Francisco, and is that, do you think that's one of the challenges, the way the applications are structured?

I do think it's a challenge. I will say we're technically a large county with a mix of an urban core and a very rural bow tie shaped geographic region, 6,000 square miles. And so even for our acute inpatient psychiatric needs, they are in our urban core. And so there are challenges in terms of individuals accessing those services.

So you know, in rural communities we always get creative. And so to be creative you have to have time and you have to have the resources and the person power to execute these very complex grant applications.

And so we know that smaller counties or under resourced counties that don't receive dollars outside of the contractual obligations we have with the state, it is complex. And so you might have the behavioral health Director in a small county writing the application in full soup test nuts.

Whereas in well resourced counties that have access to other dollars, even outside of the round two planning grant, they might have, you know, very polished grant writing contracts that they can access.

And so I think our small counties, and in particular our rural counties really do have to think outside of the box and leverage the Ta made available. And obviously we all are great colleagues and we leverage each other's resources as well. I don't know if I answered your question in full.

You did, thank you. You did. Thank you.

Thank you. I just wanted to kind of dive a little deeper into this notion around what ultimately success will look like and within the context of our current unmet need. After the several rounds of BHCIP funding that we have had.

I'm just kind of looking back at the RAND table that indicated that after be chipped, the central coast will have still have 38% unmet need. Inland Empire 52%, northern San Joaquin Valley 37%. The San Francisco Bay Area is only at 62% of unmet meat. Southern San Joaquin Valley 44%.

Those are significant areas of where we don't have geographically our ability to really get at the significant need that we have right now.

So can you all just speak to what you believe is the pathway forward for addressing that unmet need so that we get as close as possible to the, you know, it doesn't have to be for LA County's at 120% or Orange and San Diego that are 93 and 90, 94, 93 respectively.

But how do we make sure that the future funding rounds for 4 and 5 with the bond are done in a way that gets us closer to having a global sense that we are actually meeting the need across the state.

Sure, I can start. I just want to make sure that we're clear in the framing too. The RAND study only talked about adults inpatient, so that's one slice of this pie. So I think success is really going to be determined by where are you sitting? You know, in behavioral health, we have a continuum of care.

You'll see that we awarded like school linked health centers, prevention centers focused on young people. We traditionally have funded a lot around treatment and high end treatment services. But we also have to think about, you know, these prevention services to prevent these diseases as well.

So as we're looking at these awards, our success is really increasing the whole, whole continuum of care. And so when you see the awards that we've made, you'll see that it's all across that spectrum. Now I just mentioned in round one, we have 3.3 billion to award. We have over $8 billion in applications.

We're not going to be able to award everything. And I suspect that that's going to be the same thing with round two.

So success from our lens at dhcs is to be the most diligent in awarding where the need is, projects that can complete, Even for those projects that we're going to have to assist and help along the way, recognizing, you know, from their application, maybe challenges that they have.

But really, once again, that's why we look so much about the local need as well and some of these support letters that we receive. Because once again, this may be the only facility in the county where there's a county collaborative or a regional approach.

So that success at the end of the day is really going to be across that continuum of care, lifting up the availability of services for individuals in California that need this help. That's what I see. We are not going to meet though every need that we have across California. And that's the unfortunate truth.

We are just in so far of a deficit with both of these diseases, not just here in California, but nationwide. Now, of course, in California, we're leading the way. I have a lot of colleagues in several other states that are very jealous of us because we're actually making this investment.

But we are not going to meet every single need that has been identified.

Yep. And certainly I appreciate that. I wonder though if it makes sense to really think about at least setting a floor or a challenge us to at least set a floor so that in areas like the central coast or in southern San Joaquin Valley, we are getting to somewhere near the amount of inventory that we need.

I am A bit focused on this acute bed inventory because there's such a huge interplay with level of homelessness and the kind of the other issues that come with having people with co occurring issues where they have SUD as well as other mental health concerns as well as being homeless.

So I would encourage us to think about whether we want to establish some kind of level of success that says that at least we made sure to have, you Know5060 whatever, 75% of the unmet need met for acute bed inventory.

To the issue that you raised, I am curious, given the fact that some of this funding really sits with HCD Housing and Community Development, the $2 billion that are coming from the bond for BCHIP around housing interventions and the interplay between housing interventions and the portion that you all are responsible for, what is the level of coordination between the two agencies around that and within kind of when you respond to that, I'm curious about this conversation that we're having around dealing with the NIMBYs in this space.

It's hard to generate letters of support when you have communities that don't want portions of the community that are dead set on really making sure that we're providing supportive services to everybody in the community. And I know that HCD has been wrestling with that with different cities and counties making different decisions to meet their housing element goals.

So can you just speak to what the level of coordination is and how you're mitigating for the challenge of dealing with counter. Counter forces that are not productive to our goals?

Sure. So we have extensive coordination between DHCs and HCD and also CalVet, we meet weekly actually and also with both of our agencies, they have reviewed our policies, we've reviewed their NOFAs, we've been doing a lot of cross training as well to really ensure that we both understand their grant requirements.

We've actually learned a lot from our homekey partners in how they've been rolling out the funding, what's worked, what hasn't worked, and that has actually been even prior to the bond, but more extensively with the bond with the NIMBY issues, that is very challenging. We have been fairly fortunate so far with bchip.

We have unfortunately though had a few projects that have had to move locations just because of the resistance in the local area. There are provisions in BCHIP that really help expedite the processes, the local planning processes, the conditional use permits and flexibilities there, which helps.

But at the end of the day, if there's so much opposition, it's really challenging for our providers to want to lift up services in a community that just doesn't want them there.

So we come alongside them when we can, you know, provide the support that, you know, to assist them and also bring in our county partners when we get to that. That degree.

But even one of our counties, the County of Riverside, they were in a location that the city just did not want them there, so they had to go in another location and that was their choice to do that. So it is a really difficult issue and we do the best that we can to support them.

But we also then support the decision like in this case with Riverside that had to move to another location that did accept them for these services.

I appreciate that tension. I also represent city within a county where those kinds of counter forces end up putting a lot of strain and stress on, on a particular city. Speaking of Oakland. Right.

Where if you have that counter force that's not willing to have these kind of supportive services in their backyard, then they end up putting a lot of strain on individual cities within that. So I just hope that we continue to try to push and balance.

And I would just to that end, like to ask the LAO, from your perspective, if there's anything from the Legislature in terms of oversight that we should really be focusing on because we're kind of relying on counties to be able to deal with forces that are sometimes beyond their, beyond their control.

Nothing comes to mind immediately. I mean, this is, you know, been a good discussion about these tensions, but I think that you see this kind of issue materialize in a lot of different policy areas. And you know, the, some of these issues have been very long standing. I think that probably illustrates that they're difficult to.

To sort out in the end. But I think that there were provisions in AB 531, which became the Prop 1 bond, I think that were meant to try to ease some of the siting of facilities. And so I think in a sense the Legislature already was trying to be attentive to those problems.

And while they sound like they were significant in the early rounds perhaps, and hopefully in the bond Administration, those issues may wane.

Just for the sake of my own sanity, these programs are incentive and volunteer driven. In terms of counties have to apply, put together proposals, or entities have to apply to be able to put together proposals. But there's nothing in statute that requires a particular county to maintain a particular service level.

No, it's all voluntary. The only requirement is that they have to provide behavioral health services for 30 years. That's the main like once they receive the award. But There isn't a requirement that either certain counties or certain facility types apply.

Okay, thank you so much. That's very helpful. I don't have any additional questions. Oh, please go ahead.

Yes, for my understanding from one of the tables that were provided about the percentage of unmet need or for in some cases this is going to support beyond the need, these resources. The RAND report.

Can you help me understand while we're discussing the fact that there's such unmet need in certain areas, how through the application process, some communities are getting even more than the assessed need?

I can start with that. My county partner here spoke of it. Just because there's a facility type, that doesn't mean that they're going to serve individuals with Medi Cal. And so in some of these instances, like in the LA area or San Diego, have to keep in mind with these facilities, they take all payment types.

This could be private insurance, commercial insurance, private pay, Medi Cal have a contract with the county. And so with bchip, we are standing up all facility types for various funding sources. That's why we narrowed down, ensuring that they're going to provide Medi Cal services.

So in these instances there can be counties that have facilities but will not take Medi Cal. And so this is an opportunity to have these facilities that will then serve the Medi Cal population. Thank you. That's very helpful.

Thank you very much. I think we can close this panel. I really appreciate the comments and the insights that you all have been able to provide around this work.

Thank you so much. We'll move now to our final panel covering planning for the Behavioral Health Services act 2025 and 2026 milestones. First up, we'll have Stephanie Welch from the California Health and Human Services Agency. Marlies Perez with the Department of Healthcare Services remains with us. Thank you so much.

Michelle Cabrera with the County Behavioral Health Directors Association. And Le Ondra Clark Harvey with the California Behavioral Health Association joins us as well. And just a note to our panelists. If you have slides, the magic is you say please cue up the slides. Please put on your mic right here.

Good afternoon, Madam Chair, Committee Members. My name is Stephanie Welch. I'm the deputy Secretary of Behavioral Health for our Health and Human Services Agency. And I appreciate the opportunity to join you this afternoon.

I feel like I'm going to zoom out in the time that I have with you, part of my role with agency, working with our 12 departments, our five offices, and have had the incredible opportunity to be with agencies in September of 2020. So if we go to the first slide, what I kind of want to ground us in is that when we worked on Proposition 1 or updating the BHSA, we did it not within a vacuum.

If you see in this slide across the behavioral health continuum we started with in partnership with the Legislature, frankly, in partnership with many of my colleagues I'm sitting here with today and advocating for deep investments across the entire behavioral health continuum.

So you'll see here in this particular slide, starting in that very first year, we were all very focused on responding to COVID. There was a very important piece of legislation passed to improve our ability to enforce and come to behavioral health parity.

And I bring this up because part of what I'm going to talk about today is make sure that we're talking about all three major systems that serve the behavioral health needs of all Californians.

So this is not a comprehensive list by any means of all the different behavioral health initiatives, but it does show some what I think are fairly incremental and thoughtful building blocks to get us where we are today.

So if you see in 21-22, we launched the Children and Youth Behavioral Health Initiative, the Behavioral Health Continuum Infrastructure Program, and are finally starting to actually implement major initiatives that we have been planning for for a reimagining of our Medi Cal program.

In 2022-23 we were working on rolling out our Medi Cal Peer Services benefit, planning to implement our Cal Aim justice reentry initiative, rolling out the 988 system of care and focusing on building out the mobile crisis system and implementing the CARE Act.

I don't have a lot of time, so I'm not going to go to everything in detail. But skipping ahead, focusing on 24-25 really critical to focus on the passage of BHConnect and the passage of Proposition 1.

These two major initiatives create the foundation to allow us to be successful with serving people with very significant behavioral health conditions. So now I have the ability to move these myself, I believe, okay in that time.

And I think many of these are investments that are one time, but some of them will have a lasting impact in changing the way that we finance our behavioral health system. So looking at this particular pie chart, you see over $14 billion of investments. Most of these, if not all of them, are administered by my, my partners over here at DHCS. But there also are things that change our benefit structure.

For example, having a mobile crisis benefit, creating a fee schedule through CYBHI so that young people, regardless of payer, can get reimbursed for services that they access through the door of an educational setting. And also just deeply investing in human capital in our workforce capital. So here that just kind of lifts up some of those investments.

I did also want to really ground us in the primary goals of Proposition 1 before we talk about our major milestones. We've talked a lot today about building facility and housing capacity. And part of that is essential because housing is a part of health.

One of the most significant changes in Proposition 1 is to allow and support counties to be able to use Behavioral Health Services Act dollars to support the housing needs of people with very serious and significant behavioral health conditions. Talk about including the ability to deliver substance use disorder care.

There is still a very significant focus on children and youth. And I don't just mean in early intervention and prevention programs. Children and youth have serious conditions and needs as well, and they will also benefit from investments in our full service partnership bucket as well as our housing bucket. And I am going to take some time today to talk a little bit about workforce.

So one of the things that I'm hearing so far in many of the conversations that we have with our partners here today, in particular counties and contractors, basically the entire network of people who provide services for our, for our counties, is that there simply aren't the people or the places to do some of these things.

And I would have to agree that that is, that's a very fair statement. It also is one of the reasons why in that timeline I was mentioning, we really started out the gate as early as I can remember.

Very much in this, in this Administration, really trying to use the resources that we had at hand to invest in building facilities, building, building housing and also building out our workforce with our first investment in cybhi. And I know that those are things that materialize over time.

It's hard to build, you know, a hospital in a year. But I do want to lift up that, as Marlies already pointed out, so I won't be repetitive in that sense. We are opening bed slots, we are opening places, places where people can get treatment that didn't exist before. And that's in many regards because of the hard work of the Members who are on both sides of me, county mental health directors and their contract providers.

But the 11 of the examples I'm really excited about to lift up is that we have over 1200 certified wellness coaches and we were able to create a new allied health profession in about two years. And, and I think many people said that never could happen, it's impossible, you're not going to be able to do it.

And I think we're making great progress. And I do think that even though we have enormous challenges ahead of us, we also have enormous opportunities to act fast and work together to fill gaps in infrastructure in particular so that we can deliver.

And I think one of the major things I want to underscore today is part of the entire inspiration in many ways behind the Behavioral Health Services Act was yes, to modernize the Behavioral Health Service Act.

Recognize that we've had the Affordable Care Act, that we've expanded Medi Cal, that people should be getting their behavioral health benefits, their mild to moderate benefits through their regular Medi Cal managed care plan. It also really was to empower counties to focus on what frankly is the hardest job in the business.

That's serving people with very serious behavioral health conditions. They for so long have had to do it all. And I think speaking on agencies perspective, I really just want to underscore our responsibility to do and support better work in making sure that people who are commercially covered are getting their care early and often as well.

If there are certain service models for people who have commercial insurance, even with a more serious behavioral health condition, they can be stable, keep their employment and go on with their recovery. Same for our managed care programs.

We do think that there are new ways in the future, in the coming years, in particular next very soon coming years, that our Medi Cal managed care plans can do more to serve people who do not meet the criteria for, for specialty mental health services.

And so that County Behavioral Health can focus on their particular task at hand and I want to just quickly go through some timelines before I pass it over to my colleague Marlise, who will go in far more detail.

At Health and Human Services, as was mentioned before, we have two other departments who have an important role to play in implementing the the Behavioral Health Services Act. So first would be, and it was already mentioned today, our California Department of Public Health.

The state has some new very awesome and challenging responsibilities with the Behavioral Health Services act so utilizing 4% to bring population based prevention efforts across the state focusing on the requirement of 51% at minimum going towards youth and children. And so they have started their planning efforts, some draft guidance.

We're hoping the first round of draft guidance will be out this spring and just a more robust stakeholder engagement process will be starting in the spring of 2025 and we will be ready to issue funds in July of 2026. The same is true of HCAI. They have an incredible opportunity to really do innovative workforce efforts.

3% of the state, the dollars that stay at the state go towards a sustained workforce program. And I think in behavioral health, I speak for many of us, we've never had sustained money to really reimagine and deeply invest in the workforce of tomorrow. Super eager and excited to think about what that looks like.

The coaches have been an incredible success. We have an aging population, we have other challeng in our state. What is the workforce of tomorrow?

And this, this gives us the opportunity to do that because under BH Connect we have $1.9 billion to support the existing workforce to make sure that we build it quickly to to deliver on all of these responsibilities that you're going to hear about. So hopefully that covers a few things.

I think I'm going to round out with 2026 and wanted to make sure that we act as a resource for all of you. I know there's many, many new people. This is complicated stuff.

A lot has been happening in this space and so please, you can always call on us to try to provide any kind of information, answer questions, et cetera. And you have many choices of websites to visit if you wanted to learn more about Prop 1. They're all there for you.

And with that, hopefully I haven't taken up too much time and I want to pass it over to my colleague Marlise Perez to talk little bit about the detailed work that DHCS is doing right now.

Great, thanks Stephanie. So Marlies Prez with the Department of Healthcare Services. So as I mentioned in the earlier panel, I am the Behavioral Health Transformation Project Executive. And what that means is I hold the BHSA implementation and also the bond.

And so what we've really been focusing on first, I just want to acknowledge that Proposition One is almost one year old. She'll be one year old this week. I cannot believe that I would say she's five with the amount of work we've all been doing together. But I do just want to acknowledge that we've really hit the ground running, not just only at dhcs and our other sister departments, but our colleagues here.

We have been busy and one of the key pieces that I really want to talk about that was mentioned earlier in the LAO briefing is our county partners are required to submit to us what's called an integrated plan.

So this is a three year plan that's a projection of how they're going to utilize their Behavioral Health Services act funding, but also not only that funding that transitioned from MHSA to bhsa, but all of the funding that they receive from dhcs at the county level. And so this is a brand new requirement for them.

They're also brand new partners that they need to work with stakeholder groups. I know one of the Members was asking about schools like school partners and other folks housing partners. So they've already had a community planning process, but this has really expanded it out.

So in order for them to do that, we have been working fast and furiously at the Department with a plethora of stakeholder engagement efforts. We've had over 40 new stakeholder engagement forums we've been hosting with our normal channels as well.

And all of this is to really bring together the guidance that our county partners and local partners need to submit that first integrated plan to us. And that is due in June of 2026. So with that, we have been rolling out what we call a policy manual and it's actually a digital policy manual.

And what's really exciting for us at the Department is this is the first time that we've done this where we're going to have all of the policy related to behavioral health transformation in in one IT solution. So our partners can review it, they can search it, and they have everything together.

So very excited to state that last week we actually released our first round of like this policy manual. And so this has the first big bucket of policy. It's over 100 pages. We're going to be set to release our second module in the coming months.

And so by June, because the first three modules will be released, our county Partners will have everything that they need in order to submit that integrated plan to us. We're also developing a new county portal where the counties will actually submit this to us electronically. Currently they prepare their MHSA plans by paper and they're quite extensive.

But we have now a new template and then we're going to have a way not only for that, it's going to benefit them in the county process and the planning process, but also benefit dhcs. As we're reviewing the various components, we'll be able to utilize this information, post it out publicly, and for the first time, we'll be able to have just a better look in to what our county partners are planning.

And then as was mentioned earlier as well, there will be a corresponding, it's called the boater, but the Behavioral Health Outcomes and Accountability Transparency Report. That's a mouthful. That is actually we're going to have a draft of that due in January of 28 and then the first final one due in January of 29.

And so with this, we will continue to be rolling policy out that is subsequent, not only for that planning process, but about monitoring, oversight, some additional bond requirements through the course of 2025 as well. Well, but I do just want to acknowledge that our county partners and our providers, our behavioral health data systems are very old.

They're old, they don't function very well. They're very siloed based on funding sources. It's been really challenging for our providers and our county partners to provide us with the data that we need.

But what BHSA does is it brings a new level of accountability and transparency to behavioral health, as I mentioned, across, across all of those funding streams. So we are really looking, as we are building this out, is really redesigning our data systems and our infrastructures.

We really are looking to remove duplication to really make it easier for our partners to submit the data that we need to be, you know, not only making decisions at the state level, but the county level as well, but also to be really responsive to the public what it is that they need to know that's happening in their local area.

So we're very excited about this aspect as well. So as we have, as I've been stating, like with the policy manual is one example, the implementation plan, the Boater. These are some of the IT solutions that we're looking at developing as well as other corresponding ones along the way. So with that, I'm going to turn it over, I think to Michelle.

Thank you. Thank you so much. Michelle Cabrera, Executive Director for the County Behavioral Health Directors Association and if you could please pull up my slide deck. Thank you.

I am really happy to be here today to provide an update as to where we are with the implementation of Prop 1 from the county behavioral health Director perspective and just wanted to kind of maybe level set and provide a little bit of context as those slides are getting pulled up that you know, often in policy settings or in communities we hear folks saying, Ah, Prop 1, it's all this new money for counties.

Right. And as we just talked about, there is a significant investment through the bond in bricks and mortar infrastructure.

I'm going to focus the majority of my comments today on the other piece of Prop 1, which is really about restructuring our ongoing funding stream, which historically has been referred to as the Mental Health Services act or the Millionaires Tax, passed just over 20 years ago and which looking forward will be recast as.

The Behavioral Health Services act or bhsa. So if I can just go to. The next slide, I think you have to help me. Yeah, okay, cool. Thank you. So historically counties have relied on the MHSA as a major source of funding to support the county safety net.

This tax represents more than a third of the state funding for county behavioral health and it's one of the main funding streams used by counties to supply the non federal share for medi Cal services. So roughly half of the MHSA historically. Has been used by counties as that source to draw down federal funding.

Historically, counties were required to engage in their local communities in building out the three year spending plans that Marlise referenced just a minute ago. And those spending plans had to be done according to categorical funding restrictions. The buckets that Will talked about earlier.

The mhsa, because the number of millionaires has grown over time, has generally become our biggest source of state funding and it's definitely also our most complex. Proposition 1 represents a shift in how counties are able to use those funds in terms of policy, budgeting, accountability and as well as those infrastructure components discussed in the earlier panel.

So let's get into some of the policy shifts represented by Proposition 1. Proposition 1 changes our focus so that we are more intensely going to be serving the most vulnerable populations experiencing homelessness and severe mental illness and substance use disorders. Stephanie touched on this as well.

In contrast, the Mental Health Services act was more focused on mental health exclusively, but across a broader spectrum of needs to include more community based prevention and addressing the needs of those who might be at risk for developing a serious mental illness.

Under Prop 1, the state has much more authority over how county local funds are spent and it puts a greater emphasis on those high needs populations. In addition to specifying treatment modalities with new requirements for counties to provide evidence based practices and to stitch together the BHSA funding requirements with that new Medi Cal waiver that Stephanie referenced.

BHConnect so there is overlap between the Medicaid waiver and our funding requirements under the bhsa. An example of this is the new requirement for counties to provide assertive community treatment or ACT under the full service partnership component. This mirrors the new optional benefit for counties to provide ACT under the Medi Cal waiver.

BHSA also creates a new requirement for counties to use funds to pay for housing. While counties were able to use MHSA funds in the past to pay for housing, it was not a requirement or a defined set aside as it will be now. Finally, it requires counties to use the tax to Fund substance use disorder services.

Again, historically MHSA funded mental health services and those funds could be spent on individuals with co occurring suds as long as it was co occurring with their mental health. The goal of the MHSA was just that, to Fund mental health services and CBHDA's Members supported lifting that restriction.

Given our goals to better integrate mental health and SUD services throughout the continuum. Prop 1 also represents a shift in how county's budget. It does this by doubling the state's allocation from 5% to 10% of the tax to Fund those new state grant programs for workforce and for behavioral health prevention.

Under CDPH, this funding drops our overall funding for counties and even within the funding components. For example, counties will have slightly less funding for FSPs and at a time when they're incurring new evidence based practice requirements which will make those services more expensive to provide.

It doesn't take a mathematician to tell you fewer dollars more high cost services equals likely fewer people to be served. The majority of the counties will also need to adjust their budgets to reallocate a third of their funding away from services to pay for the new housing obligation.

To the extent that counties and community want to expand SUD services, they will need to draw from these existing funds as the total amount going to counties will be slightly lower than before and counties will be prohibited from using these funds to continue population level prevention and they will see a significant drop in the funding historically dedicated to mental health and outpatient as well as crisis services which I will highlight in the next couple of slides.

So this is a pie chart that we put together and this is what I like to Call the apples to apples pie chart. We tried as much as possible to color code the old MHSA buckets and align those with the new BHSA provisions. And what you can see here is that in purple, that's the new housing requirement.

And the other pieces. The blue represents early intervention with what used to be prevention and early intervention. The lighter orange slice is the full service partnership. And then the dark orange is what used to be the General services. And that typically funded outpatient services as well as crisis services.

So when I say we're getting less funding for outpatient in crisis, that's really where the squeeze comes in. Maybe I should call it an orange rather than an apple. This next slice represents the comparison with some actual numbers applied that you can see based on estimates from the state, how funding levels will shift as we prepare to implement the BHSA starting in 2026.

And I share all of this with you all to say that, you know, when we think about new money, yes, there's new money for housing that will be an ongoing source of funding to house individuals under the BHSA, but it's coming out of existing program service dollars and we will have far more requirements connected with the BHSA, so we'll have less flexibility in how we want to reallocate the rest of those services.

Proposition 1 also represents a change in accountability at both the state and local levels. Counties will need to expand the array of local stakeholders that they engage to include representatives from cities as well as individuals with lived experience of substance use disorders.

They'll need to partner more closely with public health and managed care plans in deciding how to allocate the BHSA funds. And the measure also grants the state authority over how our funds are spent, along with new tools for the state to require more detailed reporting on all their funds, not just the millionaires tax.

The state is also in the process of establishing new outcome accountability targets and we will have they will have the ability to impose sanctions on counties for non compliance in reporting, for example, or for quality concern concerns.

All of these new requirements, whether fiscal or programmatic reporting and accountability, will translate into significant new administrative requirements for counties as well as our contract providers.

Although the MHSA was always heavy on reporting, as Marlise mentioned, lots of paper reports, the BHSA changes are intended to make those reports more digestible and comprehensive at the state and local level. So with us bringing that into the 21st century, trying to make it more digital, but it's also going to be more granular and that's going to require more of our providers under BHSA.

At the end of the day, counties have spent the last 20 years building trust with their communities and they want to make sure that they continue to build upon that relationship to expand it and bring in these new partnerships.

Last but not least, Prop. 1 establishes the new infrastructure bond for state competitive grants, which we talked about earlier. And and counties will continue to compete with other private providers and look forward to working with the state to build upon the lessons learned as described earlier from those earlier rounds to ensure greater alignment not just with regional needs.

But I think I don't want to miss the point that our substance use disorder infrastructure capacity is sorely, sorely lacking. And again, with Prop 36, with SB 43, with some of the other integration drives that we have, we really want to see that funding not just looking at local needs, but also at that substance use disorder capacity.

And last but not least, as you will see from this slide, we are just, as Marlee said, a year out from the passage of Prop 1 and you know, we want to lay this foundation for the massive policy and fiscal changes that counties will have to implement to date.

We have our first module and this is a really novel approach to state regulatory guidance as well. Over the last year we've worked really closely with DHCs as well as counties to try to understand these new policies and how they will impact counties, budgeting and services.

Counties have been modeling the impact, but we won't be able to get a full picture of how they're allowed to spend the dollars under the new BHSA rules until that third module is released later this year.

We are so appreciative of the team at DHCS and Health and Human Services Agency who have been spearheading this effort as well as our local partners. And we look forward to further updates regarding the implementation of Prop 1. And welcome any questions you might have. Thank you. Thank you. Please go ahead.

All right. I'm lucky at last. Hi everyone. I'm Dr. Le Ondra Clark Harvey. I'm the Chief Executive Officer of the California Behavioral Health Association. That's okay. Slides. Yes, we'll take them early. We represent diverse behavioral health providers across the state. These safety net providers serve around 2 million Californians annually. We provide outpatient residential services in schools and community based services as well, all over the place. Can I say next.

There's only one deck left. The Mental Health Services Act is near and dear to our heart. Our founder, it was the brainchild of our founder, Rusty Selix, in collaboration with legislative champion Darrell Steinberg. Now I can hit it. All right. All right. The MHSA established a dedicated revenue stream for community based mental health programs with strong emphasis on early intervention and recovery oriented care. That was really the focus and the base of it. It also fostered innovation. It expanded services for historically marginalized populations and built a framework for holistic client centered care.

This is reflected in the data provided by our members prior to the Prop 1 passage. And as you can see, a high percentage, only over 75% of our providers use MHSA funds to provide services. Now don't get me wrong, MHSA was imperfect and incomplete, especially as it was missing funding for substance use disorder services.

But it was a good start and ultimately evolved into a pivotal funding source for the public behavioral health system. We were proud to collaborate with the administration on shaping the changes to the act. The BHSA has really advanced the vision and introduced new purpose for the funding, in particular housing services.

While there are other funding streams to supplement where funds have been redirected, such as BH-CONNECT and HCAI programs, there are still challenges. And in the meantime, as we wait for opportunities to materialize, we need to address those.

So you've asked me to provide an update directly from those who are serving your constituents. First, for the planning process and implementation, one provider says in a northern county that the planning process is well underway and it allows providers to advocate for the movement of funds between categories.

However, there has not been an opportunity yet for them to advocate for the specific program service changes in their counties. In one southern county, a provider reported that the planning group has been established. There's good representation from mental health providers, but not enough substance use disorder providers yet.

In another northern county, a member said there is concern about a lack of funding and capacity to scale up substance use disorder services, as was echoed prior to my testimony. Also workforce and infrastructure. If BHSA funds are insufficient to address these issues, providers will need to augment with funds from other sources, which is a continual challenge. When we asked providers if they see an ability to expand services, as always, providers are hopeful and creative and said they would do whatever it takes.

Specifically, our members that run full service partnership programs and housing interventions anticipate an opportunity to expand services, but they're also recognizing the high and growing demand for these services and are concerned about the inadequate workforce at this point. Another concern is a possible reduction in funds formerly earmarked for innovation.

These funds, which have provided needed flexibility based on county need to test new service models, expand telehealth, and develop culturally responsive care models. Last, our members have identified that BHSA has the potential to encourage better integration between substance use disorder, mental health, and physical health.

However, it's unclear if the dollars will expand said services adequately and quickly enough. The passage of Prop 1 makes an important shift in how we invest in behavioral health, prioritizing infrastructure, housing, crisis, and substance use disorder services.

While this is a necessary expansion in our view, it must be implemented in a way that preserves and straighten strengthens, excuse me, the vital community services that MHSA established. Simply, we want to ensure that the BHSA builds upon MHSA's success rather than replacing its core values. To do so, we must preserve what works.

So there are many programs that have been life changing for individuals and communities. The prevention and early intervention services have helped stabilize people before they even reach a crisis and they must remain a priority in our funding structures. Infrastructure expansion must align with community needs as well.

The focus on housing and treatment facilities is absolutely essential, but buildings alone will never solve our behavioral health crisis. Sustainable service funding and workforce investments must accompany infrastructure projects to ensure that new facilities actually translate into expanded access to care. We must keep equity at the center, of course, especially in these times where it is being threatened.

MHSA was a step forward in addressing racial and geographic disparities in mental health services, and as we implement BHSA, we must be intentional about ensuring funds actually reach communities that have been historically underserved, particularly in rural areas and and BIPOC populations. We must continue innovation and accountability.

MHSA empowered counties and providers to develop creative, culturally responsive models of care, and this flexibility must be maintained to ensure new investments are responsive to local needs and accountable to the very people they serve. In closing, yes, we were way overdue in in re-examining the act.

We are glad for the changes that have been proposed, but but funding must be based on data that drives decisions and clear and achievable accountability measures. The role of counties, providers, the Behavioral Health Oversight and Accountability Commission, and local stakeholders and community voices is critical because there is so much at stake here.

CBHA appreciates and will continue to collaborate with the administration and the Legislature as BHCA, BHSA, excuse me, is implemented. Our primary concern is those who had impacts, the providers of services who are delivering the services on the ground, and most importantly, the safety net clients that they serve. Thank you.

Thank you. And we'll open it now for questions from the committee. I'll start us off with a few. So first, I want to thank, Ms. Welch, for your comments on the slide that had the system improvement needs. And basically my takeaway was everyone needs to start kind of stepping up to the challenge a little bit more significantly. Can you speak specifically to what you think needs to happen within the commercial insurance space and how commercial insurance needs to be able to do their part so that we can ensure that the onus doesn't fall on county behavioral health plans?

Yeah, a couple of examples. We're coming right out of a year long planning process to implement AB 988, which is not just the expansion of our 988 crisis call centers, but also just really examining our overarching crisis system. And I think one of the things that is just a crystal clear example is making sure that when our county behavioral health system does serve someone in crisis who has commercial insurance, that they receive prompt payment. So I think what I think some of us have learned in this is that it's not just the person who's in crisis.

I think there's a provision that lifts up, that is lifted up in the BHSA to really ensure that people who end up using services that are provided by county behavioral health receive prompt payment from commercial insurance. Now, that is basically plugging a hole in the boat.

I don't think that that essentially is really the way to solve the problem. A couple of things that we've been working on, you're really thinking through and working with our plans in a way that is still affordable for all Californians. How can we introduce models that we know that we've learned in serving our Medi-Cal population that are effective?

How do we work with our commercial plans to have capacity to diversify their own workforce to do things like bring in community health workers, to bring in people who can potentially deliver a service that currently is not within the repertoire of what many of our commercial plans cover, like service navigation? It's very difficult.

I'm sure many of you may have had to experience trying to navigate the behavioral health system for yourselves or for your loved ones. And it's pretty daunting and complex. And if you are already challenged by an anxiety disorder or depression or a substance misuse, you may be less able to really navigate that system successfully on your own.

So I think I find this one area of incredible opportunity, and I actually, I think we have plans that are also very interested in learning how to do do and serve this population more efficiently. I think since I was talking about crisis, another thing that we've been discussing and wanting to have deeper conversations with our commercial partners is recognizing the high cost of untreated behavioral health disorders for people who they're already insuring. We've looked at data.

There are people who have substance misuse challenges and they fall down the stairs and they injure themselves and have to be admitted into the hospital. So I think we want to have bigger conversations about how expanding access to services in a way that is of financially viable and responsible could in the end hopefully bring down costs for our commercial partners.

Appreciate that. And I do have another question kind of related to the, Ms. Perez's comment about the antiquated nature of our behavioral health system data databases. Can you speak to whether that, whether there's going to be any modification to that, any upgrades that are happening, what the timeline is associated with that and whether it's encompassed in the innovation funding that's been provided or out of the admin funding to be able to support that?

Sure. Yeah. So it's definitely a key provision of what we are lifting up at the department. First and foremost because the legislation requires these new elements like the county integrated plan and the boater that I spoke about, but also because in order to really get to one of the main provisions that we've all spoke about here today is that accountability and transparency. And that's really at the local level with the providers, the county level, the state level, the Legislature. We really need to be able to see what's happening in the county behavioral health system with the funding for that safety net population.

And without redesigning our IT solutions and really having that data available, we're not going to be able to meet the goals that are outlined in the legislation. So I just briefly touched on some of the work we've been doing in 2024 and 2025 around that digital policy manual, having the integrated plan, the boater. But we do have other work that we're planning underway that we'll be continuing to roll out as we continue to roll out the pieces of legislation.

I think that goes to a comment that Ms. Harvey made about the need for us to be able to focus on how we sustain these services in a more integrated way. Ms. Harvey, you highlighted the importance of overall kind of innovation within the innovation funds for providers to be able to use in order to be able to introduce creative solutions that are equity based and that are specifically targeting historically disadvantaged communities. Given the fact that the BHSA dedicated innovation funding is now gone, do you have any thoughts or directives or challenges to us perhaps around additional sources of funding to be able to support that innovation work?

Yes, that was a main concern of many providers when we saw the proposal. Of course, there are decisions that counties and providers can make together around prioritizing funds for innovation projects. But at the end of the day, we started with the pie. It got sliced up. Something is going to give. And so we appreciate the opportunity and the flexibility for counties and providers to work together to determine that. And yet we know historically that those innovation funds and even the PEI funds have been used for culturally specific programs.

It really was that space of flexibility to build new things, to try new things, and to serve populations that otherwise could not be served within some of the other categories. So we do hope that as our county partners work with our providers that they will continue to prioritize and still the reality of there being stress there is something we can't ignore.

Thank you. And I think just a final question, likely an opportunity for each of you to be able to address the fact that we have, as you said, we're about to celebrate one year of this Prop 1, and we've radically transformed or kind of in the beginning process of how to be able to really look at our overall behavioral health system in a way that is incredibly productive.

Also has put a lot of requirements and to scale quickly and to move with expedients on the counties to be able to do that work just as a way to be able to make a plea for the counties from your perspective on what needs to happen. What can we in the Legislature and the state be doing to be able to ensure that we have an opportunity to make sure that the counties are moving with great urgency, as I know that they are, without completely overwhelming to the point of seizing the county's ability to actually be able to provide, to be sustainable in their efforts?

Thank you, Madam Chair. The one thing I would say is that I think we're there. We are. We are already there in terms of the change sort of initiative fatigue. And I think it's important for the Legislature to understand that we need a moment to take a beat and we need to allow counties and the state to implement the various massive policy changes that have been passed over the course of the last several years.

Not because there aren't additional great ideas out there, but because when so many things are happening simultaneously, and we've really only talked about one of the many today. It can also get really difficult for any human to keep on top of all of the various changes.

And this combination of tons of really massive changes, plus this hyper focus on data and accountability brought together makes the stakes that much higher. I would argue that we know more about the minutiae of county behavioral health spending than we do any other place in healthcare. I'm willing to assert that. And it's important, yes, to have accountability.

And it's also important to allow our providers and our systems to do the vitally important life saving work that they do without sort of tying one hand behind their back and putting them in a sack race. You know, it's sort of, it can get, can get very challenging with the best of intentions of having public trust, having that sense of assurance that counties are doing the right thing when you put too much in there. I'll give you one really important example. The Medi-Cal managed care plans and commercial plans deal in medical care.

Things are reported through claims. The state has the ability to analyze claims data and to draw conclusions from that. Our system is fundamentally different in that it's biopsychosocial. And so the coolest things that happened under the BHSA or MHSA, like some of those equity focused community defined practices, were not medical services and therefore not reported to the state as claims.

And therefore getting information about that will require asking more of those mom and pop providers that do such brilliant, beautiful work in the community but don't always have the resources, the infrastructure that our big hospital and health plan and physician groups have. And so that's another tension that I just want to uplift to say yes, data is important, yes, accountability is important. But also we don't want to break the sort of magic that exists within the system at times.

If I may, I know I'm not a county person, but I wanted to lift up a couple of things that we are doing that I think that we should do as a state. One is, and this came up a lot during the legislative process, we have put out a lot of initiatives, we have made major changes to our Medi-Cal program.

There are certain things that you can in the future get federal financial participation for that you couldn't in today's world. We need to do some fiscal, global, holistic financial analysis to really support and make sure that, like I have said, I hope it came across in the themes of what I was talking about.

I truly think that county behavioral health has the hardest job in the business. You know, it's not easy to serve people with that many complex problems who are living unsheltered in many cases, or children who, you know, are unable to participate in school because of whatever conditions they have.

And so I do think it lays upon us to provide technical assistance in supporting them to have the best ability to leverage those resources and that we need to do more in order to identify how to support them in doing that. Part of one of the things we're trying to accomplish with the BHSA is to make sure where we can use Medi-Cal, we do use Medi-Cal.

For the very reason that we're lifting up here, so that when we don't have to use it and we can use MHSA for something else, we have the ability to do so. That that is not going to be easy, especially since we keep adding all of these benefits to our Medi-Cal package. So we have an intensive amount of training and technical assistance to do. And I hope that we will muster the, the ability to do that.

But I can say here we do have really good working relationships, which I appreciate and feel like we have a community that's really excited about trying to make the most of this opportunity. And so if we continue to give each other grace and figure out how to do it together, I have great hopes that we'll make progress in a short period of time.

And I just want to add to that what we're looking at from the department lens is that need for extensive technical assistance with our county providers. There is a lot of change that BHSA brings, but it also brings a lot of elements of the behavioral health system together. It's not a one time initiative.

This is an ongoing effort. So this is going to take time to roll out and stand up and then modify and evaluate. And to your question of what can the legislative Members do is, first of all, I just want to thank you for all the support that you all have provided behavioral health. Just having been in this space for so many years, we were forgotten. And individuals, these vulnerable folk, nobody cared. And they were in the justice system, foster care.

And so now we're kind of swung to the other side of everybody cares, which is great. But it is, it can be, you know, put a lot of pressure on the system. But I just want to speak for the individuals that aren't here today and these are those that are suffering with these diseases that we have to keep moving forward. It's exhausting work.

I've read every public comment. I told you, I've read every BHCIP application like, because I care so much about these individuals and their families and the communities. You see the devastation. The opioid rates were going down. They're going back up. You know, you look at our young people that are completing suicides at, you know, unfathomable rates.

So we can't stop. We can't. But we can give grace. And that's what we're looking at as we are implementing at DHCS, where can we make some exceptions? Where can we lean in? How can we help? And so I would just caution us that we can't stop now. We have really made such tremendous progress in California, and we owe those individuals that, and we have to keep marching forward. So if we have specific asks, we'll definitely come to you. But I do just want to thank you for your support that you have had. And even sitting here today and listening and learning is another key. And so thank you.

About seven years ago, I was a chief consultant in the Assembly, and I'll tell you, there weren't many hearings on behavioral health. That was like a dream. And now we have them all the time, multiple times a week, and we're trying to catch up and come to them. So I'll echo that there is more attention here.

For many years, we felt like the stepchild that didn't get a lot of, you know, attention next to our physical health providers and industry. So this is important. So, you know, we welcome the oversight and the accountability. We welcome more of it. It doesn't mean it's easy to, you know, really pivot and, and provide the information, but I do think it's necessary. The partnership has been really strong, as my colleagues have said, and I hope that we continue that.

But in terms of what the Legislature can do is you can keep having these hearings, keep bringing us to the table, and also bringing all of us to the table. I think sometimes folks think county behavioral health, they deliver the actual services. And to an extent that's true.

And to a larger extent, it is the negotiated, contracted providers that are doing that work in the trenches. And so having those voices reflected in these conversations is very important. And I've seen more of that, and we're happy about that. I think, also echoing the technical assistance, traditionally it has gone to counties, and that's important. And I do think we need another layer, another drill down of technical assistance that's provided directly to providers. So whatever can be done to support that and encourage that, I think was really important for us as well.

Well, thank you so much to all of our panelists for lending their expertise and insights and for just allowing us to have a very robust conversation about an area that I know many of the Committee Members, including me, feel incredibly passionate about in terms of building up a strong behavioral health system that we can rely on in the State of California.

With that, we are going to now move to public comment at this time. So if we have anyone who would like to make public comment, I invite you to come into the room and you will have an opportunity to offer one minute of provided testimony to our committee.

Good Afternoon, Chair Bonta and Committee Members. My name is Dixie Samaniego from the California Alliance of Child and Family Services. We represent 160 nonprofit community based organizations across the state serving vulnerable children, youth, and families. We very much appreciate the input from panelists today and the presentation regarding BHT implementation.

Many of our members were awarded BHCIP grants in all of the funding rounds, and while grateful for the opportunity to build infrastructure for more behavioral health facilities in their communities, we agree with many of the recommendations in the LAO report that the awards and design may be reinforcing historical inequities rather than improving them.

In order to access the grants, our members had to complete multiple steps and sub-steps that required out of pocket spending for lawyers, contractors, and other professionals sometimes result in resulting in as much as a million dollars or more in upfront costs. Many smaller CBOs are not able to absorb these costs without dispersed prior funds and along the way expenses as they are being incurred.

In fact, many of the projects started by our members could have possibly been abandoned had we not found a way to advocate and partner with DHCS for support to get through the steps to release some of these funds to help. We recommend that in order to maximize success of the Prop 1 bond that opportunities be made to disperse funds immediately and upon grant approval as expenses are being incurred.

Thank you.

Good afternoon, Chair and Member. Tara Gamboa-Eastman with the Steinberg Institute. Just want to thank you for the conversation and thank our DHCS and HHS partners for their tremendous work braiding together Proposition 1 with CalAIM and BH-CONNECT and the countless other initiatives. We are however, concerned about the state's outcome and accountability framework for behavioral health transformation.

We don't believe that the data recommendations from DHCS's Quality Equity Advisory Committee appropriate leverage the depth of data the state has available to measure the impact of behavioral health transformation. This information is essential to improving the quality of programs to deliver the outcomes we're striving for, and it was one of the biggest failures of the MHSA over the last 20 years and we really hope that we don't repeat that failure. Happy to follow up with your staff with specific recommendations on the that. Thank you.

Thank you.

Good afternoon, Chair and Members. My name is Kelsey Lyles. I'm with the California Pan-Ethnic Health Network. As California moves forward with the Behavioral Health Transformation Initiative, we ask that our state and local government partners prioritize racial equity, transparency, and meaningful community engagement in the implementation process.

We appreciate the work being done to develop a robust measure set for planning and accountability and recommend the following approaches. First, support counties in demonstrating how they are prioritizing community engagement with diverse populations. Secondly, incentivize counties to develop specific language access plans that acknowledge both threshold languages and languages spoken by smaller populations within their communities.

Thirdly, prioritize funds for community based organizations delivering culturally and linguistically tailored care and lastly, conduct equity audits to ensure funding is reducing disparities as intended. We believe these recommendations will help us create a more accessible and community centered behavioral health system for all Californians. Our partners are ready to work alongside the state and counties to make this happen. Thank you.

Thank you.

Good afternoon, Chair Bonta, Member, and Staff. My name is Trent Murphy. I'm here on behalf of the California Association of Alcohol and Drug Program Executives, also known as CAADPE. We represent substance use disorder treatment providers across the State of California.

I'll focus my comments just on BHCIP just to keep my comments short. But we are appreciative of DHCS for looking primarily in their discretionary funding to small providers and small counties in the BHCIP process. But one key issue for these underserved regions is the issue around the requirement for county letters of support.

These have created conflicts of interest as counties and community based providers often compete for the same pool of funding, leaving many providers at a disadvantage. Additionally, providers face excessive administrative burdens in both the application and reimbursement processes, which have led to project delays and financial hardships.

Allowing for upfront payments for certain costs would ease this financial strain being felt most acutely by small providers. And lastly, while we support launch ready projects, the program's focus on expansion overlooks the need to renovate aging treatment facilities.

A set aside of dedicated funding for facility renovations would ensure that the state is truly expanding service capacity and not simply replacing existing treatment infrastructure. So we appreciate the Legislature's focus on Prop 1 implementation and are here for technical assistance if needed. Thank you.

Thank you.

Chair and Members. Beth Malinowski with SEIU California. Thank you again for the hearing today. Our SEIU Locals, in particular our 21 Locals, are proud to represent our county behavioral health workforce and many of them are starting to engage at the local level with a lot of the efforts that you heard reference today. Our locals remain hopeful.

There's progress, as was noted today. There are also areas of concern, and just wanted to in particular draw attention to one of the counties where we're hearing some concerns from. Currently in Kern County, our SEIU Local 521 is actually preparing for its county workforce to go on strike.

This includes the behavioral health workforce. And interestingly in some of the conversations there, you know, what we're starting to learn is that potentially Prop 1 is being used as justification for behavioral health workforce changes and even decisions by the county not to take other opportunities to have additional behavioral health dollars from the state that we know could be greatly used locally.

So we want to draw this to your attention today in particular, just I think reinforce the importance of conversation spaces like this. We know that's not the intention for Prop 1. It's only one case, of course, but certainly would not want to see this replicate in other places. We're working of course with our local to hopefully find resolution here. But again I think just draws the importance of the conversation we're having today. So thank you again.

Thank you.

Good afternoon, Madam Chair, Committee. Thank you so much for holding this hearing today. My name is Danielle Bradley on behalf of the California State Association of Counties, representing all 58 of California counties. You know as as discussed, Proposition 1 will have significant policy and impact, or and fiscal impacts for our counties and the communities they serve. And we are, we're feeling those today.

With regard to BHCIP, we are deeply appreciative of the LAO's analysis of the program to date and look forward to continued engagement with the administration and the Legislature on how we can improve how BHCIP funds are awarded under Prop 1 and are allocated to have the most impact and benefit to the communities they serve.

On BHSA, counties appreciate the deep engagement to date with the administration on the development of guidance towards full implementation, and we look forward to continued discussions to ensure adequate flexibility and resources are provided to ensure that all these reforms are successful. Thank you so much.

Thank you for that public comment. And with that, I will just offer some closing remarks. I want to thank the panelists and stakeholders and members of the public for joining us today on this critical issue of ensuring that we have a true, truly transformed behavioral health system across the State of California. The reforms we were able to discuss today were just but two of the many, many major efforts that are being concurrently implemented to address our state's behavioral health crisis.

And it was certainly made loud and clear to us that providers, counties, behavioral health systems across the State of California are doing everything that they can with great amount of urgency to make sure that we're taking advantage of an opportunity, a once in a lifetime opportunity to really build out the infrastructure.

I want to just recall the comments that were made that really reflected that this is something that wasn't the case 20 years ago, 10 years ago. We're certainly relying on and standing on the shoulders of legislators like Susan Eggman, and we're thankful that Assembly Member Irwin could join us today to be able to build out what we know is going to be ultimately a very important and critical program for the health of California over time.

At the same time, implementation continues to be something that we need to be very dogged about, focusing on making sure that we are critical and thoughtful about the ways in we roll out these major efforts. Implementation hurdles and lessons learned are all a part of the journey.

And I appreciate the spirit in which many of our panelists, all of our panelists brought to the conversation to just recognize that that is a part of what we need to do to be able to ensure that we are building a strong California. And so I want to take the time to thank you all for participating, for offering a spirit of collaboration and an energy of goodwill to be able to ensure that we can move forward and make the funding opportunities that we've already made and the investments that we've made really count for California.

I want to appreciate that work, and I look forward to our committee and certainly appreciate that I get the double duty of sitting on the Budget Sub 1 in Assembly and Health to really look at some of these policy initiatives and the ways in which we need to be able to continue to build a sustainable behavioral health, transformed behavioral health system for every Californian. I want to thank you all and our Committee Members for coming together to join in that conversation. With that, I get to gavel down first time by myself this year. We're adjourned. Thank you.