Special Notice / Hearing: None__
Vote Required: Majority
To: Honorable Board of Supervisors
From: Colleen Chawla, Chief, San Mateo County Health
Jei Africa, Director, Behavioral Health and Recovery Services
Subject: San Mateo County Behavioral Health Services Act Three-Year Integrated Plan for FY 2026-27 through FY 2028-29
RECOMMENDATION:
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Adopt a resolution authorizing the approval and submission of the San Mateo County Behavioral Health Services Act Three-Year Integrated Plan for FY 2026-27 through FY 2028-29 to the California Department of Health Care Services and authorize the Chief of San Mateo County Health or designee(s) to make non-substantive revisions to the Integrated Plan without additional approval from the Board of Supervisors.
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BACKGROUND:
In March 2024, California voters approved Proposition 1 (Prop. 1), which transforms county behavioral health through the creation of new statewide goals, prioritization of permanent supportive housing, and utilization of evidence-based practices for the most vulnerable populations experiencing serious mental health and/or substance use disorder (SUD) challenges. Prop 1 has two main components: (1) Senate Bill 326, which changes the Mental Health Services Act (MHSA) into the Behavioral Health Services Act (BHSA), and (2) Assembly Bill 531, which authorizes bond funding for capital development of behavioral health housing and treatment beds.
BHSA requires that 30% of funding be allocated to Housing Interventions (HI), 35% to Full Service Partnerships (FSP), and 35% to Behavioral Health Services and Supports (BHSS). Additionally, 50% of HI funds must be used for people experiencing chronic homelessness, and at least 51% of BHSS funds must be used for Early Intervention programs.
Under BHSA, Counties are no longer authorized to use local BHSA funding for Prevention programs previously funded under MHSA. Prevention activities will instead be administered and funded through new statewide behavioral health prevention initiatives established by the State.
State legislation requires that counties prepare a Three-Year Integrated Plan that encompasses all county behavioral health revenue and planned expenditures for the period of FY 2026-27 through FY 2028-29. The Three-Year Integrated Plan must be approved by the County’s Board of Supervisors.
The Behavioral Health Commission held a public hearing and voted to close a 30-day public comment period on March 5, 2026. BHRS is now recommending approval of the BHSA Three-Year Integrated Plan for FY 2026-27 through FY 2028-29 by this Board of Supervisors.
DISCUSSION:
BHRS engaged in a comprehensive community planning process (CPP) to help inform strategies to address identified needs and gaps in service for the Three-Year Integrated Plan. The CPP was guided by a BHSA Transition Taskforce, which met four times over a six-month period. In addition, the CPP included five “deep dive” information sessions on the impact that Prop. 1 has on BHRS services; 14 community input sessions; five targeted discussions with community partner groups, including a youth focus group; engagement with over 300 clients, families, community members and providers; and nearly 100 survey responses.
The CPP began in April 2025 and concluded in November 2025. CPP input received was used to inform the behavioral health strategies in the Three-Year Integrated Plan that BHRS will implement to address statewide goals. These strategies include:
Housing Interventions (HI)
HI funding will support ongoing operating subsidies, tenant-based and project-based vouchers, housing assistance, property management, and on-site supportive services across the County’s Permanent Supportive Housing portfolio for behavioral health clients.
Capital development investments will focus on increasing the number of units dedicated to behavioral health clients, which will continue through the Department of Housing (DOH) administered Affordable Housing Funds, including projects funded through the annual Notice of Funding Availability and other DOH capital development opportunities.
Funding will be braided with Medi-Cal Managed Care Plan (MCP) Community Supports and other local and federal housing programs to create a more seamless and sustainable housing continuum and the development of a scatter-site tenant-based rental assistance program. The MCP collaboration includes aligning with its Cal-AIM Transitional Rent benefit to ensure individuals can move from interim or bridge housing into permanent housing.
Early Intervention
A key initiative will be the release of an Early Intervention Services Request for Proposals (RFP) in summer 2026 to strengthen how youth are identified, assessed, and connected to ongoing supports following a crisis. The RFP will prioritize reducing disparities in access to care, particularly for underserved and high-risk populations with a focus on youth ages 0-25 and expanding access to both mental health and SUD services. These efforts will align with San Mateo County Health, Public Health Policy and Planning, and Community Health Improvement Plan priorities and promote the use of community-defined and evidence-based practices.
Beginning FY 2025-26, California counties will be required to establish and maintain trust funds for each funding component and appropriately allocate BHSA funds and unspent MHSA funds into each component. BHRS will continue to spend down unspent rollover funds in the MHSA trust fund as follows:
1) Ongoing spending over projected revenue: Projected revenue over the next three FYs is $61,733,124. The ongoing budget for each of the next three fiscal years is $67,638,332, $64,538,936, and $63,088,403, respectively. Unspent MHSA Workforce, Education & Technology funds and encumbered Innovation (INN) funds will cover the balance. INN funding expires at the end of FY 2028-29.
2) One-time budget: Unspent and unencumbered MHSA funding has been allocated to each of the new BHSA components, as required by statute, to support the following one-time projects over the next three fiscal years:
• Funds to support implementation of evidence-based practices to fidelity
• Behavioral Health Community Infrastructure Program match for increasing residential treatment beds
• Permanent housing development capital costs
• Epic electronic healthcare record system to manage clinical, access, and revenue data
The FY 2026-27 BHSA proposed budget can be found in Appendix 5 of the Three-Year Integrated Plan.
Any revisions to this BHSA Three-Year Integrated Plan necessitated, for example, by a County change in funding commitments described in the Plan, will require an update to the State at a later time.
The resolution has been reviewed and approved by the County Attorney as to form.
DHCS measures access to care as the percentage of the Medi-Cal-eligible population that enters mental health and/or substance use treatment. In FY 2022-23, only 3.7% of Medi-Cal-eligible youth in San Mateo County received care for a mental health or substance use need. This penetration rate is lower than the statewide benchmark (4.2%) but aligned with the penetration rate of other “large” counties in California (3.7%).
It is anticipated that there will be a 4.65% serious mental health service penetration rate for youth (under 21 years old) in the County.
PERFORMANCE MEASURE:
|
Measure |
FY 2025-26 Estimated |
FY 2026-27 Projected |
|
Serious mental health service penetration rate for youth (under 21 years old) |
4.2% |
4.65% |
COMMUNITY IMPACT:
Prop. 1 prioritizes serving the most vulnerable individuals living with serious mental illness and/or SUDs, those experiencing or at risk of homelessness or those who are justice-involved. In addition to dedicated funding for housing interventions to meet this need, the Three-Year Integrated Plan includes increased funding for Full-Service Partnerships to provide intensive services for the most complex BHRS clients.
Prop. 1 and BHSA also emphasize the importance of access to care and early intervention, especially amongst children and youth. BHRS will be issuing an Early Intervention RFP in FY 2026-27 to address any observed disparities across all statewide priority goals and access to integrated substance use and mental health services.
FISCAL IMPACT:
BHRS received $69,816,503 in MHSA revenue, including interest, in FY 2024-25 and anticipates $49,854,757 in MHSA revenue in FY 2025-26. BHRS anticipates $61,733,124 in BHSA revenue for FY 2026-27. Funds that are not yet allocated through BHRS’ internal planning process or RFP to the community will be held in one of three BHSA trust funds (BHSS, HI, and FSP) as required by statute. These trust funds are also used to manage the fluctuations in funding that occur from year to year, as well as to support maintenance of effort and cost increases for current programs. There is no Net County Cost associated with this Plan.