Editorials

Stop finger pointing on hoarded mental health millions. Just spend it wisely

Mayor Darrell Steinberg greets Fredrick Gayle at a special joint meeting between the Sacramento City Council and Sacramento County Board of Supervisors on homelessness in January 2017. Under Steinberg’s pressure, county supervisors agreed to spend state mental health money on the homeless.
Mayor Darrell Steinberg greets Fredrick Gayle at a special joint meeting between the Sacramento City Council and Sacramento County Board of Supervisors on homelessness in January 2017. Under Steinberg’s pressure, county supervisors agreed to spend state mental health money on the homeless. Sacramento Bee file

It turns out that Sacramento County isn’t alone in stashing millions of dollars that could be spent to help Californians with mental health problems.

A new state audit uncovered that California’s 59 county and local mental health agencies had piled up $2.5 billion in unspent cash as of 2015-16. State Auditor Elaine Howle blames state agencies for failing to give enough guidance or oversight.

We don’t want to waste tax money, and the state does need a clearer strategy on mental health. Still, the mentally ill, their families and their advocates have reason to be upset. There are plenty of worthy ways to expand and improve treatment and services. One obvious example: the crisis of California’s growing homeless population, many of whom have mental health needs.

Under pressure from Mayor Darrell Steinberg, Sacramento County agreed late last year to spend $44 million – nearly half of its mental health stash – on a bold program to get chronically homeless people into mental health and addiction treatment, shelters and permanent housing. Other counties should consider the same.

The money in question comes from Proposition 63, the Mental Health Services Act that voters approved in 2004 and that levies a 1 percent surtax on income of more than $1 million a year. In 2015-16, Prop. 63 generated $1.5 billion, and the state sent $1.4 billion to the 59 local mental health agencies.

These agencies had $535 million in reserves as of 2015-16, and by sitting on the money had accumulated $81 million in interest, according to the audit, released on Tuesday. Also, the state neglected to take back $231 million that should have been redistributed to other agencies, the audit says.

The California State Association of Counties says counties already do “an incredible job” of providing mental health services, but says “additional guidance from the state will help ensure counties are in compliance with both the letter and the spirit of the law.”

The County Behavioral Health Directors Association of California says that agencies are complying with current rules, but tracking unspent money is difficult, which is why it’s sponsoring Senate Bill 688 to make financial reports clearer.

The association disputes that agencies are sitting on the $231 million. Until a new law took effect Jan. 1, they weren’t legally allowed to spend that money, and now Sacramento and other counties are quickly coming up with plans, the group says.

The audit calls on the state Department of Health Care Services to come up with policies to reallocate unspent money, establish the right reserve levels and increase oversight of the local agencies.

The department is working on new regulations, but they likely won’t be ready until next year. The sooner the better because the gusher of cash is continuing – Prop. 63 is projected to raise $2.1 billion this budget year and $2.2 billion in 2019-20.

The county mental health directors say they support the audit’s recommendations to determine appropriate reserve levels. While counties are encouraged to save some money because Prop. 63 revenue can change significantly from year to year, depending on the stock market, hoarding too much money is just as irresponsible.

Steinberg, who authored Prop. 63, told The Sacramento Bee’s Adam Ashton that “the reserves have just grown too large and the needs are too great to justify that.”

Meanwhile, a proposed $2 billion state bond issue to build housing for homeless – by using Prop. 63 money to repay the bond – is tied up by a lawsuit that claims that housing construction isn’t allowed by the measure.

The bottom line of this audit is it’s a wake-up call for local and state mental health officials to do better. Taxpayers – even millionaires – have every right to expect that their taxes are spent wisely, and promptly.

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