Summary
Gov. Gavin Newsom’s administration promised that early projects funded under California’s $6.4 billion mental health bond would begin opening in 2025, but CalMatters reported none of the 10 projects expected to finish by the end of last year met that timeline. The reporting, distributed by The Associated Press, found that the delays span the state and, in some cases, push openings back by as much as two years or lead to cancellation.
Proposition 1, which California voters passed in 2024 by a narrow margin, was pitched as a cornerstone of Newsom’s broader plan to expand care for Californians living on the street with mental illness. The bond was also intended to supply resources meant to support other efforts, including CARE Court, which uses the courts to get more people into treatment. CalMatters said the construction delays mean some people who need services will wait longer than envisioned.
CalMatters said the state awarded nearly half of Proposition 1’s funds last spring and described that process as the fastest distribution of bond money in California history. When the money was released, California officials said they expected 10 of the first 124 projects to be finished by the end of last year, but the planned opening schedule was missed.
According to CalMatters, nine of the 10 initial projects were delayed. The new completion dates reported by CalMatters range from this summer to summer 2028, and one project was cancelled, the investigation found. CalMatters also said those delays highlight the difficulty of scaling up treatment capacity quickly while navigating California’s expensive and competitive real estate market.
In a news conference Wednesday, Newsom acknowledged “snags” in project delivery even as he argued the bond was “exceeding its goals.” Newsom said that “Some of that has been impacted by, candidly, tariffs, supply chain issues,” adding, “So there’s been some slippage in some of the projects. We’re deeply mindful and aware of that, but we’re just managing that on a daily basis.”
This week, Newsom’s administration awarded the remaining $1.18 billion from Proposition 1 for additional treatment beds and outpatient slots. CalMatters reported that the bond has funded 177 projects and said they are expected to create 6,919 residential treatment beds and 27,561 outpatient treatment slots—both totals described as higher than the original promises associated with the measure.
Assemblymember Jacqui Irwin, a Democrat from Thousand Oaks who carried the bond proposal in the Legislature, commended the state for awarding funds quickly but said the projects still must open as soon as possible. In an email to CalMatters, Irwin wrote that while Proposition 1 allows projects to move from concept to blueprints, they are not immune from supply-chain challenges or competition for skilled labor and that the Legislature, the executive branch and the public must demand the facilities open quickly.
CalMatters reported that delays varied across regions, including Los Angeles and Marin County. In Hollister, the investigation said a building expected to be purchased using Proposition 1 money was unexpectedly sold to another buyer, requiring the grantee to find a new property. Another project in Los Angeles is now expected to be at least two years late after the grantee found the building needed seismic retrofitting.
The state’s Department of Health Care Services told CalMatters that it is “expected and common” for large projects to push back completion dates. The department said it checks in with grantees to monitor progress but does not penalize them solely for delays; it also said the state helps resolve construction issues and adjusts timelines when projects fall behind. The department further said delays for some projects included permitting, site conditions and construction pressures, including supply-chain strain tied to President Donald Trump’s tariffs.
CalMatters also described specific cases involving nonprofit grantees. In Placer County, nonprofit Koinonia Family Services was awarded nearly $2 million to create eight short-term residential beds for foster youth, but CalMatters reported the nonprofit declined the grant and cancelled the project, saying concerns about the long-term sustainability were raised by changes in state and federal policy. The nonprofit did not respond to emails seeking more detail.
In Orange County, nonprofit Encompass Housing won $31 million for 50 beds for new mothers needing mental health and substance use treatment and the investigation said the project’s initial estimated completion date was winter 2025. CalMatters reported that Encompass CEO Deby Wolford said last month the organization had not yet purchased the property, describing “some delays” with the bond, and she did not answer follow-up emails seeking additional information.
Even with delays, CalMatters reported that many projects are moving forward. In Hollister, Youth Recovery Connections had to scramble after losing out on its first attempt to purchase a building; CalMatters said that change set the project back about a year and a half, but the new building the nonprofit intended to buy would be larger and cost a little less, according to executive director Michael Salinas. In San Rafael, CalMatters reported that the Ritter Center used Proposition 1 funds to buy a new building and renovate it, aiming to open this summer after a delay of about six months from the initial projection.
The bond is also tied to permanent housing for people with mental illness and substance use disorder through the governor’s Homekey+ program, CalMatters reported. The state has awarded $768 million to create 2,260 homes, including 545 reserved for veterans, with the first of those projects due to be completed this summer.
CalMatters said Proposition 1 also shifts other mental health funding priorities by requiring counties to direct housing spending instead of certain other services from revenue generated by the millionaire’s tax for mental health care. The change, CalMatters reported, could force counties to rework budgets while they are already managing reductions to programs such as suicide prevention, mental health hotlines and anti-stigma campaigns. Michelle Cabrera, executive director of the County Behavioral Health Directors Association, said Medi-Cal funding to fill gaps is less doable after federal Medicaid cuts and that counties expect “challenging times ahead” as some programs may need to be reduced or cut entirely.