For a more in depth discussion of Proposition 2, and the ten other initiatives on the ballot this November, join us for the California Initiative Review Forum in the Lecture Hall at McGeorge School of Law on October 24 from 5:30 – 7:30pm. Details on the event here.

Proposition 2: Use Millionaire’s Tax Revenue for Homelessness Prevention Housing Bonds Measure

Current Law

  • In 2004, California passed Proposition 63, which put into effect the Mental Health Services Act (MHSA).
  • Proposition 63 was created to expand and improve mental health services across the state, to be funded by a 1% tax on individual incomes exceeding $1 million.
  • Implementation of the MHSA has been plagued with issues, including poor oversight and mismanagement of funds.

Proposed Law

Proposition 2 authorizes the Department of Mental Health (DMH) to distribute funds from MHSA to the No Place Like Home Program (NPLHP) to create permanent housing for individuals with mental illness who are homeless or at risk for chronic homelessness. It also authorizes the California Health Facilities Financing Authority (CHFFA) to enter into contracts with developers and others for this purpose

Proposition 2 also creates a Supportive Housing Program Subaccount within the Mental Health Services Fund in which all general fund appropriations and MHSA funds will be collected and distributed, and authorizes CHFFA to issue bonds in an amount not exceeding two billion dollars ($2,000,000,000) to finance permanent supportive housing pursuant to the No Place Like Home Program and related purposes. Finally, it authorizes the California Legislature to appropriate up to $140 million per year to fund the Supportive Housing Program Subaccount. Any funding from such appropriation, up to a $140 million threshold, reduces the authorized but unissued amount of bonds that the CHFFA may issue.

Policy Considerations

Yes on Proposition 2 No on Proposition 2
  • Authorizes the state to use revenue from Proposition 63 (2004)—a 1 percent tax on income above $1 million – for mental health services
  • Authorizes issuance of $2 billion in revenue bonds for homelessness prevention housing for persons in need of mental health services.
  • Will deliver reliable and safe housing to mental health patients that live on the streets.
  • No vote opposes authorizing the state to use revenue from Proposition 63 (2004) on housing related projects including issuance of $2 billion in revenue bonds for homelessness prevention housing for persons in need of mental health services.
  • Proposition 2 will only benefit bureaucrats, developers, and other businesses that will receive most of the funds.

Analysis of Proposition 2 provided by David Witkin and Kaylin Huang.

 

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.