News Article | February 07, 2025
Senate Finance Committee Reviews HHSC Budget
The Senate Finance Committee took up the 2026-27 budget for the Texas Health and Human Services Commission (HHSC) this week. Along with the Foundation School Program and school-related property tax relief, HHSC is a major cost driver in the state budget.
Senate Bill 1, the Senate's baseline bill for the 2026-27 biennium, allocates $94 billion in All Funds and $39 billion in General Revenue funds to HHSC. For perspective, funding for HHSC represents 28% of total funding recommendations in SB 1 and 25% of General Revenue funding recommendations in SB 1.
Here are highlights of the mental and behavioral health funding in SB 1 important to Texas counties.
- $1.8 billion to raise the base wage for personal attendant services to $12 per hour.
- $521.6 million to continue salary increases provided in the current budget for state hospital and SSLC staffs and operational funding for new state hospital construction. According to HHSC, these pay raises were pivotal in reducing staff vacancies at state hospitals and bringing state hospital beds online. The COVID-19 pandemic greatly impacted HHSC's workforce levels at SSLCs and state hospitals, with a 3,500 or 18% drop in filled positions between February 2020 and August 2022. Operating funds for newly constructed hospital beds have had the same effect, increasing the number of operational beds. According to the Legislative Budget Board (LBB), SB 1 provides enough funding and staff for 319 new beds added in the last two years to remain online. Increases in operating capacity at state hospitals can lead to reduced days in county jails for individuals with severe mental health issues awaiting transfer to a state hospital bed for competency restoration.
- An intent rider in SB 1 for the supplemental appropriations bill for the current two-year budget commits the 89th Legislature to fully fund Medicaid for fiscal year 2025 and provides $10 million for a new mental health facility in Brazoria County.
- Maintains funding for the 529.1 community-based private psychiatric beds currently contracted for by the Local Mental Health and Behavioral Health Authorities (LMHAs/LBHAs).
- $230.5 million for Community Mental Health Matching Grant programs established by prior legislatures to assist communities in providing alternatives to jail for justice-involved individuals with mental health issues. This represents a $116 million decrease from current funding due to one-time grants to construct local jail diversion, step-down, permanent supportive housing, crisis stabilization, or crisis respite centers. (See the Community Mental Health Grant Programs table for more.) SB 1 eliminates a targeted grant for the Harris County Jail Diversion Program and adds the previously allocated $10 million to the overall funding allocation for mental health programs for justice-involved individuals.
| Community Mental Health Grant Programs – SB1 Funding Levels | ||||
|---|---|---|---|---|
| Grant Opportunity | 2024-25 Biennium | 2026-27 Biennium | ||
| Healthy Community Collaboratives Program | $ | 33,000,000 | $ | 33,000,000 |
| Texas Veterans + Family Alliance Program | $ | 20,000,000 | $ | 20,000,000 |
| Mental Health Grant Program for Justice-Involved Individuals | $ | 80,000,000 | $ | 90,000,000 |
| Harris County Jail Diversion Program | $ | 10,000,000 | $ | |
| Community Mental Health Grant Program | $ | 55,000,000 | $ | 55,000,000 |
| Supporting Mental Health and Resiliency in Texans (SMART) Innovation Grant Program | $ | 29,524,266 | $ | 29,524,266 |
| Rural Mental Health Initiative Grant Program | $ | 3,000,000 | $ | 3,000,000 |
| Community Mental Health Grant Program – One-time Construction Grant Program | $ | 100,000,000 | $ | |
| Children's Hospitals Construction Grant Program – One-time funding | $ | 15,852,990 | $ | |
| Total Community Mental Health Grants | $ | 346,377,256 | $ | 230,524,266 |
In addition to this baseline funding, HHSC has requested $9.2 billion in All Funds, including $3.2 billion in General Revenue funds. Most of the funding is for cost growth in Medicaid, the Children's Health Insurance Program (CHIP) and two smaller programs.
For a status report on inpatient mental health construction projects funded by SB 30, see Supplemental Schedule 3-3, starting on page 37 of this LBB document. For a status report on the items listed in Rider 52, Informational Listing: Additional Mental Health Funding in HB 1, the current General Appropriations Act, see Supplemental Schedule 3-4, starting on page 39 of this LBB document.
Finally, for a comparison of mental and behavioral health funding in the House and Senate baseline bills, see pages 6-7 of our baseline bill comparison document.
For more information about the state budget, please contact Zelma Smith.