The Steinberg Institute releases new analysis of Governor Gavin Newsom’s behavioral health proposal, finds Governor’s plan makes urgent and necessary changes to the MHSA

August 3, 2023

The Steinberg Institute releases new analysis of Governor Gavin Newsom’s behavioral health proposal, finds Governor’s plan makes urgent and necessary changes to the MHSA

Report also finds recent critiques of Governor’s proposal to be unfounded

SACRAMENTO (August 3, 2023) – A new report, Honoring the Vision of the MHSA through Transformation, released today by the Steinberg Institute concludes that Governor Gavin Newsom’s Behavioral Health Modernization proposal makes urgent and necessary changes to align funding priorities with the original intent of the 2004 Mental Health Services Act (MHSA). 

The report also addresses recent assertions that the Governor’s proposal will inhibit spending on prevention and early intervention services and weaken behavioral health oversight. After reviewing the history of the MHSA and analyzing the various behavioral health funding streams available, it assesses these claims as unfounded.

Although the report finds the Governor’s proposal would improve California’s overall measurement and accountability practices, it recommends a change in the Behavioral Health Modernization Proposal’s language to explicitly require the DHCS to establish measurable outcome behavioral health system metrics. The Steinberg Institute authors say the change would make clear that the state is committed to fulfilling its responsibility to ensure state behavioral health programs are successful.

“The dual homelessness and mental crisis we’re currently experiencing requires us to take a hard look at the MHSA, lean into what’s working, and fix what isn’t,” said Sacramento Mayor, Steinberg Institute founder, and original MHSA co-author Darrell Steinberg.

“Far too many of our most vulnerable are not getting the care they need because billions of dollars generated by the MHSA aren’t being targeted toward those who need help the most. The Governor’s Behavioral Health Modernization Proposal effectively addresses both of these issues, and at the same time, could be made even stronger by taking into account this report’s recommendation.”

The report finds that because of a lack of proper state oversight and guidance, county MHSA spending has strayed from the legislation’s original intent, which was to provide much-needed funding to county mental health systems that did not have adequate resources to care for people living with serious mental illness or experiencing homelessness.

“It’s time to get back on track – these funds were intended to be used for our most vulnerable Californians and we need to ensure they are getting the full support they deserve,” said Steinberg Institute CEO Karen Larsen, “ Governor Newsom’s modernization proposal will help put thousands of people living with serious mental illness on the path to recovery.”

The full analysis from the Steinberg Institute can be found at

About the Steinberg Institute

The Steinberg Institute is dedicated to transforming California’s mental health and substance use care systems through education, advocacy, accountability, and inspired leadership.Founded in 2015 by Sacramento Mayor and former state Senate Pro Tem Darrell Steinberg, the institute has been the driving force behind sweeping improvements in California behavioral health policy. Visit us at

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