California Governor Gavin Newsom making media roundsafter the CNN Presidential Debate.
Sacramento, California – California is making another major push to expand behavioral health services, announcing more than $800 million in competitive grants aimed at helping communities build out mental health and substance use treatment infrastructure. The funding marks the final round of grants under the state’s Proposition 1 Behavioral Health Infrastructure Bond Act and comes on the heels of $3.3 billion in awards issued earlier this month.
The grants, administered through the California Department of Health Care Services (DHCS), are part of the Behavioral Health Continuum Infrastructure Program (BHCIP). This second and final round—titled “Unmet Needs”—is intended to prioritize areas of the state where treatment options remain limited or inaccessible.
Unlike previous rounds that targeted projects already shovel-ready, this final round focuses on communities that have the greatest gaps in care and are prepared to move forward with construction or expansion plans. Eligible applicants include local governments, tribal organizations, nonprofits, and for-profit groups. Projects must be well along in development and demonstrate a clear connection to local behavioral health needs.
The funding is part of a broader effort under California’s “Mental Health for All” initiative, which aims to transform how and where mental health care is delivered. Projects supported by the grants could include residential treatment facilities, outpatient clinics, crisis stabilization units, and mobile response teams.
Together, Rounds 1 and 2 of the Bond BHCIP are expected to significantly expand treatment capacity across the state—adding an estimated 6,800 new residential beds and nearly 27,000 outpatient treatment slots. Officials hope these investments will help ease pressure on emergency rooms, jails, and other systems currently overwhelmed by untreated mental illness and addiction.
Earlier this year, Round 1 of the bond-funded program awarded $3.3 billion to 124 projects across 42 counties, supporting over 5,000 residential beds and nearly 22,000 outpatient slots. Since the launch of BHCIP, the state has distributed about $1.7 billion to support more than 250 behavioral health infrastructure projects statewide.
With the final funding round now open, state officials are calling on communities to apply before the October 28 deadline. Awards are expected to be announced in spring 2026.
This marks the state’s last opportunity under Proposition 1 to fund brick-and-mortar behavioral health projects—part of a long-term strategy to move away from institutional care and toward more accessible, community-based solutions.
