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County explains large MHSA fund balance as it prepares for BHSA transition
Summary
Department of Mental Health briefed supervisors on a large MHSA unspent balance and how funds will be reallocated under the Behavioral Health Services Act transformation, with staff saying carryover and encumbrances cover multi-year projects and that a multi-year drawdown will support housing and expanded Full Service Partnership services.
Department of Mental Health officials on May 5 explained why the county shows a large unspent Mental Health Services Act (MHSA) balance and how those funds will be used during a multi-year transition to the Behavioral Health Services Act (BHSA).
Dr. Lisa Wong and DMH staff said the apparent large balance reflects multi-year commitments (capital, innovations, workforce/training and multi-year program encumbrances) and variability in state BHSA funding projections. They outlined how, under BHSA, roughly 30% of certain allocations must go to housing while other shares will flow to full-service partnership (FSP) and outpatient services. Staff presented a multi-year spending plan that draws on carryover funds while new BHSA revenues are realized.
Why it matters: Advocates and community members urged faster deployment to open treatment beds and expand outreach. One commenter urged that $857 million in unspent MHSA funds represent treatment beds and outreach teams that could be funded immediately.
DMH’s next steps and controls: The department said it has increased contract monitoring, sharpened procurement language and is conducting extensive stakeholder engagement (hybrid meetings and a contact list) to guide allocations. DMH emphasized the volatility of BHSA revenue projections and said it expects to draw down carryover funds in years one and two but will need additional sources after year three to sustain all services as BHSA categories shift funding priorities.
Board action: The board approved the MHSA midyear adjustments (Item 50) and directed DMH to continue stakeholder outreach and reporting.
