Where Proposition 1 Funding Is Building New Mental Health Housing Across California

California voters approved Proposition 1 in March 2024, authorizing over $6 billion in bonds to build new mental health infrastructure, such as treatment facilities and supportive housing.¹ 

The measure, intended to help those experiencing severe mental illness and substance use disorders, represents the state’s largest mental health housing investment in decades. Over a year since the legislation’s passing, construction is underway across California to improve treatment access for all. 

This article aims to help you understand where the funding is going to build new housing and treatment options. It also focuses on when people can expect new facilities across the state to begin services in their local communities.  

The Facts About Proposition 1

Proposition 1 is a proposal that combines two separate components: a $6.38 billion bond measure and new reforms to the existing Mental Health Services Act. The measure passed by a narrow margin back in 2024, with 50.2% of voters in support. 

It sought to reform how California spends its Mental Health Service Act funds, known as “Proposition 63 money.” These funds are generated from a 1% tax on incomes over $1 million.² 

Previously, counties had broader discretion over how they spent these funds. However, Prop 1 posited that 30% of them must go toward housing for people with serious mental health or substance use issues, along with veterans in need of services.² 

As a result of its passage, counties in California must apply for funding via a competitive grant process. The Behavioral Health Infrastructure Bond Oversight Committee looks over applications and awards money based on need, readiness to act, and local contributions. They are able to give priority to construction that can get started quickly and serve the most vulnerable populations.³ 

Other key requirements include that… 

• counties must track outcomes and demonstrate their new housing is helping to reduce homelessness and improve the community’s health.
• projects must include supportive services that provide access to treatment, case management, and wraparound care.
• facilities must meet specific timelines for completion, or funding can be reallocated.

Counties That Have Received Prop 1 Funding

Governor Gavin Newsom awarded over $3 billion in the first round of Proposition 1 funding this past June. Los Angeles County received the largest allocation – over $1 billion for 35 total projects.⁴ 

San Diego County received $185 million for seven projects, expected to create around 350 new treatment beds in the region.⁵ 

The nine counties encompassing the Bay Area were awarded nearly $500 million total for 19 projects, while Fresno County received funding for four new buildings.^{4, 6} 

Specific Prop 1 Projects

• Del Norte County won $4 million for the county’s first ever psychiatric facility. Sutter Coast Hospital will build an outpatient crisis center in Crescent City as well, eliminating an otherwise seven-hour drive to Sacramento for emergency psychiatric care.
• San Joaquin County officially broke ground on its Be Well Campus, located near Stockton, in late 2024, including 116 treatment beds to serve 72,000 people each year. 
• Homekey+ housing awards, designed to convert existing infrastructure into permanent supportive housing, went to Chula Vista, Glenn County, Los Angeles, Napa, San Jose, and Rancho Cordova, totaling over $284 million as of early 2026.

When Will the Next Round of Funding Happen?

A second funding round of around $800 million opened for new applications last fall, with the awards expected to be announced sometime this spring. An additional $2 billion in Homekey+ funding will also be rolling out throughout the year. 

Why Supportive Housing Matters

Everyone deserves a safe place to live, and mental health treatment rarely succeeds when someone doesn’t have a place to stay once it’s complete. 

Supportive housing seeks to provide permanent homes that combine access to ongoing mental health services, case management, addiction care, and job programs. Sometimes known as a “Housing First” model, the paradigm is an acknowledgement that having a safe environment helps build the foundation for people to address their other challenges. 

Housing First is permanent, supportive housing without time limits, bolstering the recovery process by removing people’s need to worry about where they’ll be living next month. Residents typically aren’t required to maintain sobriety or comply with treatment to keep their housing, but services are available on an ongoing basis when they’re ready. 

Studies have demonstrated that around 86% of people placed in permanent, supportive housing are able to remain housed after several years. Further, they’re also better able to take part in long-term treatment for mental health issues.⁷ 

Statistics and Facts About Supportive Housing

Research shows that access to supportive housing services can reduce total emergency room visits, emergency psychiatric hospitalizations, and jail bookings. Counties have also been shown to save money when more people have stable housing, as they then require less engagement with crisis-based services.⁸ 

For example, participants in California’s Housing for a Healthy California program experienced 0.58 fewer emergency department visits and 0.38 fewer hospitalizations in the six months after being housed compared to the six months before. Total Medi-Cal payments declined by $6,771 per person – a reduction of $5,590 greater than that of similar people who remained unhoused.⁸

Santa Clara County’s Project Welcome Home focused on people with the highest crisis service use. Before enrollment, participants averaged five hospitalizations, 20 emergency department visits, five psychiatric emergency visits, and three jail stays over two years.⁹ 

Proposition 1 designated $2 billion for supportive housing because California’s ongoing mental health and homelessness crises are deeply related. Over 170,000 state residents experience homelessness, with 77% of these people having a diagnosable mental health condition. Sadly, only around 19% of these people receive any treatment services.¹⁰ 

Providing new housing and treatment solutions helps California address the mental health and homelessness crisis at the same time, along with reducing the total costs to counties and taxpayers.

When Will New Facilities Open?

While the type of project in question and the funding it receives can vary, California prioritized launch-ready infrastructure with Proposition 1 funding. This means the first wave of services is expected to begin this year, and large-scale campus operations will follow through 2029. 

The fastest projects expected to come online are those funded through Homekey+. This focuses on converting existing infrastructure (such as hotels or office buildings) into permanent, supportive housing in cities like Los Angeles, Chula Vista, and San Jose. 

The first building of the San Joaquin Be Well Campus is slated to open in the summer of 2027. Further, additional wings for residential treatment and urgent care will open in six-month intervals through 2028.

Many psychiatric facilities are proposed to open between 2027 and 2028. Moreover, the majority of the 6,800 promised treatment beds and 20,000-plus outpatient slots should be operational by the end of the decade. 

Partner With AMFM for Your Recovery

At A Mission For Michael, we know that mental health recovery requires much more than a bed – it takes a community of specialized care, clinical know-how, and unwavering support. 

As California’s new infrastructure takes shape, we remain committed to providing the evidence-based care and personalized paths to recovery you and your loved ones need. 

Contact us today to find out how you can get started. 

Frequently Asked Questions About Proposition 1

Without the right information, Proposition 1 can be daunting to wrap your head around. This is why we’ve provided the following answers to FAQs on the topic. 

What Exactly Does Proposition 1 Fund?

The measure authorizes over $6 billion in bonds for two main areas. Most funds will go toward building treatment facilities, but $2 billion is earmarked for permanent supportive housing for veterans and vulnerable adults. 

The investment aims to create over 6,800 treatment beds and 26,700 outpatient slots across the state. It focuses on closing the gaps in California’s mental health infrastructure by providing places for people to heal, rather than forcing them to cycle through jails or emergency rooms. 

Who Will Be Eligible for New Housing?

The housing created by Prop 1 is intended for people with serious mental health or substance use issues. Priority will be given to those who are either currently unhoused or living in an encampment. 

Specifically, the program is looking to serve extremely low-income individuals who are either chronically homeless or at risk of institutionalization. By law, over $1 billion of the housing fund is reserved for veterans with behavioral health needs. This helps ensure that those who’ve served have a stable place to engage in the recovery process.

Will Proposition 1 Affect Existing Mental Health Services?

Counties must now spend 30% of their existing mental health tax revenue on housing, per the measure, ensuring people have better access to stable housing and ongoing treatment. 

Prop 1 also reforms the Mental Health Services Act, with counties required to integrate addiction treatment into their core services, providing a whole-person approach to treatment. 

When Will New Homes and Treatment Beds Be Ready?

New converted buildings will be opening sometime this year, with larger, ground-up treatment sites beginning construction and expected to start accepting patients sometime in 2027 or 2028. 

The rollout is designed to happen in phases. Every county is expected to submit a detailed Integrated Plan to provide the public with exact opening dates for local clinics and housing in their community. 

References

1. Legislative Analyst’s Office (2004, March 5th). Proposition 1 [Ballot]. Lao.ca.gov. https://lao.ca.gov/BallotAnalysis/Proposition?number=1&year=2024 
2. California Department of Health Care Services. (2025, May 29). Proposition 1 fact sheet (Behavioral Health Transformation). https://www.dhcs.ca.gov/BHT/Pages/Fact-Sheet-Prop-1.aspx
3. Davalos, M., & Ramos-Yamamoto, A. (2024, October 7). California Passed Prop. 1: What’s Next for Behavioral Health System Reform? California Budget and Policy Center. https://calbudgetcenter.org/resources/california-passed-prop-1-whats-next-for-behavioral-health-system-reform/ 
4. Kendall, M. (2025, June 12). California voters passed a $6.4 billion mental health bond. Now, see where that money is going. CalMatters. https://calmatters.org/health/mental-health/2025/06/prop-1-mental-health-awards/
5. Sisson, P. (2025, June 6). San Diego County organizations win seven Proposition 1 grants. San Diego Union-Tribune. https://www.sandiegouniontribune.com/2025/06/05/san-diego-county-organizations-win-seven-proposition-1-grants/
6. California Governor’s Office of Emergency Services (2025). Proposition 1 continues delivering support for vulnerable homeless populations in California. New mental health services and housing coming to cities throughout California | PFWT Cal OES News. (2025). Ca.gov. https://pfwt.news.caloes.ca.gov/proposition-1-continues-delivering-support-for-vulnerable-homeless-populations-in-california-new-mental-health-services-and-housing-coming-to-cities-throughout-california/ 
7. Peng, Y., Hahn, R. A., Finnie, R. K. C., Cobb, J., Williams, S. P., Fielding, J. E., Johnson, R. L., Montgomery, A. E., Schwartz, A. F., Muntaner, C., Garrison, V. H., Jean-Francois, B., Truman, B. I., & Fullilove, M. T. (2020). Permanent supportive housing with housing first to reduce homelessness and promote health among homeless populations with disability: A community guide systematic review. Journal of Public Health Management and Practice, 26(5), 404–411. https://doi.org/10.1097/phh.0000000000001219 
8. UCLA (2024). Supportive housing program for Californians experiencing homelessness shows promise. UCLA Center for Health Policy Research. https://healthpolicy.ucla.edu/newsroom/blog/housing-healthy-california-evaluation-2021-22 
9. Kurtzman, L. (2020, September 17). Study Finds Permanent Supportive Housing is Effective for Highest Risk Chronically Homeless People. UC San Francisco. https://www.ucsf.edu/news/2020/09/418546/study-finds-permanent-supportive-housing-effective-highest-risk-chronically
10. Feller, A. (2023, July 12). After deinstitutionalization, California has tragically come full circle on mental illness treatment. CalMatters. https://calmatters.org/commentary/2023/07/california-tragically-mental-illness-treatment/