In a case of toxic trickle-down, county mental health officials now find themselves pressed to find $1.4 million to fund a successful program that keeps mentally ill homeless people off the streets. Governor Arnold Schwarzenegger axed funding on August 25 as part of Sacramento’s convoluted and dysfunctional budget dance: In order to get the Republican votes needed to pass his budget, the governor agreed to cut $700 million from the $145-billion budget. Among the most controversial casualties was the $55 million that funded the mentally ill homeless program, created in 1999 by Assembly Bill 2034. It was from that pot of gold that the county’s $1.4 million came, funding services for 120 clients a year. Statewide, 4,700 people benefit from the program.

Given the chronic fiscal woes confronting the county mental health department-a surprise $5-million shortfall was found earlier this year-there’s no obvious substitute funding source. The governor’s aides argue that counties could use funds generated by Prop. 63-the tax on millionaires benefiting mental health services, which voters approved in 2004-but the language of Prop. 63 prohibits using its revenues to supplant existing mental health operations. And a statewide coalition of mental health advocates has already threatened legal action. Besides, noted county spokesperson William Boyer, the Prop. 63 money is already allocated for other services.

By all accounts, the programs funded by AB 2034 have been uncommonly successful, providing a wide range of housing, health, and job support services to the mentally ill homeless. In fact, three years ago, Schwarzenegger himself bragged about the program’s effectiveness while on a trip to Washington, D.C. According to the state’s own figures, those now enrolled in the program have experienced 81 percent fewer days locked up, 65 percent fewer in psychiatric institutions, and 76 percent fewer on the streets. In Santa Barbara, the numbers are similarly impressive. According to Roger Heroux-former director of the county Public Health Department, who now administers Santa Barbara’s federally mandated “10-year plan to end chronic homelessness”-the loss of funding would seriously hamper the effort to address the problem. Already, he noted, Santa Barbara County has more animal shelters than homeless shelters and only 12 detox beds. In fact, Heroux discovered that county law enforcement and health agencies spend roughly $40 million a year dealing with homeless people, “with nothing to show for it.” Heroux argued that housing the homeless and helping them become self-sufficient would cost dramatically less than jailing, hospitalizing, or institutionalizing them.

AB 2034 was authored by then Assemblymember Darrell Steinberg. Based on its success, Steinberg-now a state senator-also authored Prop. 63, which included language to make it legally impossible for counties or the state to use its revenues to cover ongoing mental health programs. “The whole idea was we wanted more mental health services, not just a different funding source for existing services,” explained Jim Evans, Steinberg’s spokesperson. Evans noted the state budget preserves a controversial tax shelter on yacht sales that costs the state $45 million a year.

Meanwhile, it remains uncertain how long the county can or will pick up the state’s slack. At an August 28 meeting, Telecare-the private company that provides these services for the county-announced its contract remains intact despite the lack of funding. It was not clear, however, whether Telecare had the funds needed to maintain the housing required by its clients. County mental health officials said they were evaluating their options, but were wary of a suit by advocates if Prop. 63 funds were used to sustain current programs. And there was some indication that mental health advocates might not sue, based on news from the state Department of Mental Health that $50 million in “unallocated administrative reserves” associated with Prop. 63 had just been discovered. While the advocates are confident they would prevail in court, they also recognize such a strategy would last five years. By then, the program would surely be dead.


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