None of the projects expected in 2025 under Gov. Gavin Newsom’s mental health ballot measure have opened, CalMatters has found, even though the governor says the bond is exceeding its goals.
Newsom promised that thousands of mental health treatment beds would come out of Proposition 1, a $6.4 billion bond California voters passed by a narrow margin in 2024. But projects in the initial round have hit delays, in some cases pushing back opening dates by two years, or been cancelled.
The state awarded nearly half of the money from the bond last spring, kicking off what Newsom described as the fastest distribution of bond funds in California history. When it rolled out that money, the state said it expected 10 of those first 124 projects would be finished by the end of last year.
That didn’t happen. CalMatters has confirmed that nine of those projects were delayed, with new completion dates ranging from this summer to summer 2028. One project was cancelled.
The bond is a cornerstone of Newsom’s broader plan to help Californians living on the street with mental illness, and it’s supposed to provide some of the resources necessary for the governor’s other mental health programs to succeed. Without the new in-patient beds, out-patient treatment slots and housing promised under Prop. 1, programs such as CARE Court, which uses the courts to get more people into treatment, won’t be as effective.
The delays in getting Prop. 1 projects built highlight the difficulty of quickly scaling up treatment options to meet the demand for mental health care in California, as well as the challenges of building anything in the state’s expensive and highly competitive real estate market.
They also mean some of the state’s most vulnerable residents will have to wait longer for help.
The administration tried to fast-track Prop. 1 projects by smoothing some permitting and other hurdles, Newsom said during a news conference Wednesday. But he admitted there have been snags.
“Some of that has been impacted by, candidly, tariffs, supply chain issues,” he said. “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.”
Newsom this week awarded the remaining $1.18 billion from Prop. 1 for new treatment beds and outpatient slots. In all, the bond has funded 177 projects, which are supposed to create 6,919 residential treatment beds (119 more than originally promised) and 27,561 outpatient treatment slots (861 more than promised).
“This is a point that needs to be emphasized: Exceeding the goal in record time,” Newsom said.
But those projects, though they have now been funded, have yet to come to fruition.
Assemblymember Jacqui Irwin, who carried the bond proposal in the Legislature, commended the state for awarding the funds quickly, but said the projects must open as soon as possible.
“While Prop. 1 allows these projects to go from concept to blueprints, they are not immune from supply chain challenges or competition for skilled labor that hinders construction of every type in our state,” Irwin, a Democrat from Thousand Oaks, wrote in an email to CalMatters. “That however does not minimize that the legislature, the executive branch, and the public must demand these facilities open as quickly as possible.”
Statewide delays
Delays happened across the state, from Los Angeles to Marin County, for a variety of reasons. In Hollister, a building that was supposed to be purchased with Prop. 1 money was unexpectedly sold to someone else, and the grantee had to scramble to find a new property. Another project in Los Angeles is now expected to be at least two years late because the grantee discovered the building needs seismic retrofitting.
The state’s Department of Health Care Services emphasized that it’s “expected and common” to push back completion dates for large projects. The state checks in regularly with grantees to monitor progress, but doesn’t penalize them just for running into delays. Instead, if a project is falling behind, the state helps resolve construction issues and adjusts its timelines as needed.
“While most construction remains on schedule, some individual project timelines have shifted slightly due to permitting, site conditions, and construction pressures, including supply-chain strain from President Trump’s tariffs,” the department wrote in an email to CalMatters. “These projects are moving forward and will deliver long-term treatment capacity for generations.”
In Placer County, nonprofit Koinonia Family Services was awarded nearly $2 million to create eight beds that would have provided short-term residential care for foster youth. But the nonprofit ultimately declined the grant and cancelled the project. Koinonia said that was because of “changes in state and federal policy” which raised concerns about the project’s long-term sustainability. The nonprofit did not respond to emails asking for more detail.
Other projects ran into administrative hurdles.
In Costa Mesa in Orange County, nonprofit Encompass Housing won $31 million to create 50 beds where new mothers who need mental health and substance use treatment can stay with their babies. The project initially had an estimated completion date of winter 2025. Last month, Encompass CEO Deby Wolford said the organization hadn’t even purchased the property yet, because of “some delays” with the bond. She didn’t answer follow-up emails asking for more detail.
Despite the delays, most projects are moving ahead.
In Hollister, the nonprofit Youth Recovery Connections had to scramble when it lost out on its first attempt to purchase a building. The about-face set the project back about a year and a half, but it came with a silver lining. The new building the nonprofit intends to buy is bigger – with double the office space where patients can be seen — and actually costs a little less, according to Youth Recovery Connections executive director Michael Salinas.
In San Rafael, the Ritter Center won $10.5 million to open 1,370 treatment slots. The nonprofit already provides mental health care and other support to more than 2,500 homeless and precariously housed clients per year. But its current digs – which Ritter has rented for the past 45 years – are getting to be too old and cramped, and it’s starting to show. The center’s “patient navigators,” who greet incoming patients and tell them where to go, sit on folding chairs under a tent outside the building because there’s no room for them inside.
The Ritter Center bought a new building and is using the Prop. 1 money to renovate it and turn it into a state-of-the-art health care facility. It will double its number of exam rooms, double the capacity of its food pantry and move its patient navigators indoors.
The project should open this summer, about six months later than the initial projection.
“When people go to a low-income clinic or a place to get social services and it’s run down, it’s not reflective of the broader community, it says something about what you deserve or what the community’s values are,” said Cynthia Le Monds, chief development officer for the Ritter Center. “So by having this dignified facility, we’re really making sure that we’re giving our patients and clients the very best services that they can receive.”
Bond creates financial puzzle for counties
In addition to expanding treatment capacity, Prop. 1 is also funding permanent housing for people with mental illness and substance use disorder through the governor’s Homekey+ program. So far, the state has awarded $768 million to create 2,260 homes, including 545 reserved for veterans. The first of those projects is due to be completed this summer.
In addition, the ballot measure shifts other mental health funding priorities. It requires counties to fund housing instead of other services with a share of the revenue they get from the so-called millionaire’s tax on high earners for mental health care. That will necessitate some financial gymnastics from counties, which are in the midst of pulling funds from existing programs that are no longer prioritized — such as suicide prevention, mental health hotlines, anti-stigma campaigns and more — and putting the money toward housing.
San Diego County already has identified 29 programs to close.
The initial idea was for counties to fill the gaps with Medi-Cal funds, said Michelle Cabrera, executive director of the County Behavioral Health Directors Association. But with recent federal cuts to Medicaid, that’s no longer as doable, she said.
“There will be challenging times ahead,” Cabrera said, “certainly some programs will need to be cut back or cut entirely.”
This story was reported with support from the Rosalynn Carter Fellowship for Mental Health Journalism.
