By Posey Graber
California is betting billions of dollars that a reformed and expanded behavioral health system will help the current homelessness crisis. Proposition 1 was narrowly passed over two years ago in March of 2024 and a major component only recently took effect. The two main components of Proposition 1 are the Behavioral Health Services Act and the Behavioral Health Bond–both of which will have major impacts on those facing homelessness and housing crises. The question now is: after two years, are unhoused people actually reaping the benefits of this initiative or will it take even more time to see its effects?
What is Proposition 1?
The premise of Proposition 1 is to improve access to behavioral health services by restructuring funding allocations. One part of the proposition, the Behavioral Health Services Act, is meant to replace the state’s 2004 Mental Health Services Act. This changes how counties fund mental health services by prioritizing spending on housing and treatment for people with the most severe behavioral health needs. It is now mandatory that 30% of funding in each county throughout California is set aside to directly support housing interventions. 50% of that reserved funding is specifically dedicated to folks who are experiencing long-term or chronic homelessness.
The second component of the proposition is the Behavioral Health Bond. This $6.4 billion in funds is being used to finance supportive housing, behavioral health treatment beds, as well as veteran and tribal needs. It is projected that the bond will go towards the creation of 4,350 permanent supportive housing units, with 2,350 of those set aside for veterans. As well as 6,800 treatment beds and 26,700 outpatient treatment slots.
Progress of Proposition 1
Proposition 1 has faced many delays throughout the past two years. Much of 2024 was spent developing the programs needed in order to distribute the money. One of the programs created in 2024 was Homekey+. This program uses the funding from Proposition 1 to build permanent supportive housing for those who are experiencing or at risk for homelessness. 2025 marked the shift from planning to actually allocating funding. However, despite money being distributed, that does not mean the projects have actually been completed by this time. Construction and implementation have caused setbacks and therefore tension between voters and the California government.
As of July 1st, 2026, the state has officially made the transition from the Mental Health Services Act to the Behavioral Health Services Act. This is a major update for Proposition 1 because now 30% of the funding from the Behavioral Health Services Act will be put towards housing initiatives for people with significant behavioral health needs that are experiencing or at risk of homelessness. With this new system, all California counties have created three-year plans of how they will spend this money to connect behavioral health treatment with housing services.
Current Impact on Homelessness
As previously mentioned, Proposition 1 has experienced many delays that have even led to the cancellation of some projects. Unfortunately, none of the projects that were expected to have been completed in 2025 opened. This means that those who are most vulnerable to mental health and housing struggles will have to wait even longer to get the help they need and were promised. Homekey+ has a timeline of up to 26 months for construction projects after the funding is allocated. So even though projects are getting their needed funding, it will still take time for them to be operational and available. It is too soon to say whether or not Proposition 1 is a success or not. Good work is being done, but the setbacks are at the expense of at-risk individuals.
It is clear that a great deal of work still needs to be done in order for the effects of Proposition 1 to be evident. This month marks a major milestone and transition. The real test now is to see how the funding from the Behavioral Health Services Act translates into more housing and treatment along with fewer people experiencing homelessness. Proposition 1 shows that California has what it takes to address homelessness and behavioral health services, but more time is still needed to see if there is a measurable reduction of these issues.
References:
www.dhcs.ca.gov/behavioral-health-transformation/proposition-1-an-overview/
www.dhcs.ca.gov/behavioral-health-transformation/behavioral-health-services-act-housing-supports-primer-july-2024/
www.dhcs.ca.gov/behavioral-health-transformation/behavioral-health-bond/
www.gov.ca.gov/2025/09/17/proposition-1-continues-delivering-support-for-vulnerable-homeless-populations-in-california/
www.calmatters.org/housing/homelessness/2026/03/prop-1-update
www.hcd.ca.gov/grants-and-funding/homekey-plus/timeline-and-eligibility