Title
Receive report on Mental Health Services Act (MHSA) reserves.
Report
RECOMMENDATION:
It is recommended that the Budget Committee of the Board of Supervisors:
Receive report on Mental Health Services Act (MHSA reserves.
SUMMARY/DISCUSSION:
In 2004, California voters approved Proposition 63, the Mental Health Services Act (MHSA), the Act was enacted in 2005. The MHSA imposes a 1% tax on personal income over $1 million. Without supplanting, the proceeds are intended to expand voluntary county mental health programs to all populations, especially the unserved and underserved. The MHSA is comprised of five (5) components: Community Support Services (CSS), Prevention and Early Intervention (PEI), Innovation (INN), Capital Facilities and Technological Needs (CFTN), and Workforce Education and Training (WET). In the early years of the MHSA, discrete funding amounts were allocated to each of the five components. Currently, MHSA funding is allocated as follows: CSS 76%, PEI 19%, and INN 5%. Annual allocations have a three-year life cycle. After the three-year period, unspent funds are reverted to the State for reallocation.
Due to the volatile nature of MHSA revenue, counties are required to maintain a prudent reserve to smooth out the effects of an economic downturn. The prudent reserve is funded from the CSS component and is calculated as 33% of the average CSS allocation for the last five (5) fiscal years. For Monterey County, the current prudent reserve max is approximately $4.8 million. MHSA regulations further dictate the percentage of funds from each component that must be spent on services to children vs. adults. At their discretion, counties may reallocate up to 20% funding from CSS to provide for MHSA eligible CFTN and WET needs.
Per Welfare and Institutions Code (WIC) 5847, counties are required to prepare and submit three-year programs and expenditure plans, and annual updates, to the Mental Health Services Oversight and Accountability Co...
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