Report looks at misallocation of California’s mental health spending

An extensive investigation by the Bay Area News Group details the shortcomings of a California proposition designed to increase the state’s mental health services, which have been slashed in recent years.

In 2004, California voters approved Proposition 63, which created an income tax surcharge for people earning more than $1 million per year to expand mental health services. The tax has raised $7.4 billion in revenue.

In the past two years, the state has cut $587.4 million, or about 16.3 percent, from its mental health spending, according to a March report from the National Alliance of Mental Health. The number of individuals receiving mental health services dropped from 658,314 in 2007 to 442,691 in 2010.

Though the proposition was designed to provide funding for counties to provide new services and expanding existing ones, the state imposed roadblocks on a range of potential projects by focusing exclusively on new developments, according to the investigation.

Much of the spent money has also gone to a “cottage industry of consultants earning up to $200 an hour” and to programs only loosely linked to mental health. As a result, the state now has a “two-tiered system,” where some individuals receive extensive benefits and some are left entirely to survive on their own.

“The state of California clearly did not comply with the law and they did not keep and honor the contract with the voters,” said Rose King, co-author of the Mental Health Services Act, which appeared on the November 2004 ballot as Proposition 63. “It’s a corruption of purpose, and it’s a boondoggle for consultants and entrepreneurs at the expense of services.”

The Bay Area News Group consists of about 60 newspapers along the West Coast, including the San Jose Mercury News.