10 projects from Newsom’s mental health bond were supposed to open in
2025. That didn’t happen
[March 13, 2026]
By MARISA KENDALL/CalMatters
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.”
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California Gov. Gavin Newsom speaks at a news conference at
Belvedere Middle School, Oct. 8, 2025, in Los Angeles. (AP
Photo/Damian Dovarganes, File)
 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.”
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