MOORLACH UPDATE — Lanterman-Petris-Short Act — August 17, 2019

It seems like a rare day when a righteous lawsuit prevails. But, it does happen. And more frequently of late in Sacramento. Unfortunately, the taxpayers are left with the legal costs for the inappropriate stances taken by our Governors and their supermajority legislators.

Last year I spoke and voted against AB 1829 in the Senate Budget & Fiscal Review Committee (see MOORLACH UPDATE — Dubious Budget Trailer Bill — September 17, 2018). Redirecting lawsuit proceeds from impacted constituents to Sacramento was unethical and a legislative attempt to legitimize the action was a sad sight to behold. No wonder this bill ended up being held back at the end of last year’s Session.

What do you do when the good guys win? You celebrate with them. The Asian Journal shares the details in the first piece below.

Having been involved with homelessness issues for most of my career, the learning process in this area never stops. This year my staff has taken a deep dive into the Lanterman-Petris-Short Act (see We have concluded that there is room for improvement and maybe even an entire new review of this half-century-old landmark legislative effort.

To share a little about the analysis we have been pursuing, I submitted a piece to Inside Sacramento to stimulate dialogue on the inability to provide better involuntary assistance for mentally ill homeless individuals. Doing so would get them on the proper course and help them mainstream into society. It is the second piece below.

25th Anniversary Look Back

On August 17th, 1994, I wrote Mr. Robert L. “Bob” Citron a letter. Some issues I just can’t seem to leave alone. I also stayed true to my overriding concern about marking to market (see MOORLACH UPDATE — Marking to Market — July 12, 2019). You can also see where my infatuation with Comprehensive Annual Financial Statements started.

Dear Mr. Citron:

Enclosed please find a check for $100 that I would like you to keep on deposit. It is my request that you please provide me with a copy of the Orange County Investment Pool’s Money Max report for each month, beginning with the month ended June 30, 1994, on a monthly basis.

For each month ended June 30, I would like a copy of the mark-to-market report that you have submitted to the outside auditors for their Comprehensive Annual Financial Report fair market value disclosure requirements.

Please notify me of the costs for photocopying, mailing and postage and apply it against this deposit. I will replenish my deposit in the future when the monthly mailings causes the balance to approach zero.

As in the past, I am fully aware of the California Freedom of Information Act’s ten-day period.

Very truly yours,

John M. W. Moorlach


National Asian group celebrates housing settlement victory at California capitol 



National advocacy organizations that sought the return of $331 million to a fund for struggling homeowners attended a victory rally in Sacramento on Wednesday, August 14.

The National Asian American Coalition and the National Diversity Coalition, which led the lawsuit against then-California Governor Jerry Brown and legislative Democrats who diverted the funds for debt repayment, recently won suits to have the money returned to its original intent.

Several members of the Republican State Caucus from the Assembly and the Senate attended the press conference and gave brief remarks, including Assembly Republican Leader Marie Waldron, Assemblymember Tom Lackey, Assemblymember Jim Patterson, AssemblymemberJay Obernolte, and Assemblymember Devon Mathis; and Senate Republican Leader Shannon Grove, Senator John Moorlach, Senator Patricia Bates and Senator Ling Ling Chang.

The California Supreme Court upheld two lower court rulings which directed the State of California to return the funds to their original intent. In July, legislative Republicans delivered a letter to the current governor requesting him to outline a plan to repay the funds.

Current state Governor Gavin Newsom earlier this month announced that he would return the funds to the rightful fund.

As previously reported by the Asian Journal, the State of California received $410 million in a 2012 settlement with the five largest mortgage services in the country: Ally, Bank of America, Citigroup, J.P. Morgan Chase and Wells Fargo. After the national mortgage crisis, these companies were charged with multiple federal violations and agreed to pay more than $20 billion to affected homeowners.

The companies also made a separate payment of $2.5 billion to states to be used for a mortgage fund as a resource for homeowners and renters, with California receiving $410 million. However, $331 million of what the state received was illegally diverted to pay off state debts.

Led by executive director NAAC/NDC president and CEO Faith Bautista, Robert Gnaizda, NDC General Counsel Steven Sugarman, pastors from different churches, and members of the NAAC/NDC, the organizers called on Newsom to consult with HUD-approved agencies and homeowners regarding the disbursement and distribution of the funds, and to follow through on his promise to assist distressed homeowners in the state.

Officials from the NAAC and NDC were also scheduled to hold meetings with state officials as well as Democrats and Republicans from both the Assembly and the Senate to present their proposals to strategically and effectively use the funds to help distressed homeowners in California.

Bautista said, “I am deeply grateful for the leadership of the Senate Republican Caucus and their advocacy for the past several years. Senate Republicans continue to press both former Governor Brown and Governor Newsom to do the right thing and repay the funds. This is a victory for all Californians.”

“The $331 million was only intended to help homeowners abused by lenders during the mortgage and foreclosure crisis, not to pay down the state debt. Senate Republicans are committed to ensuring the original terms of the mortgage settlement are met and the State of California is in compliance with the court ruling,” said Senate Republican Leader Shannon Grove.


‘Not Humane’



By John M.W. Moorlach


The homelessness problem keeps getting worse.

A survey released June 26 found Sacramento County’s homeless count jumped 19 percent the past two years, to an estimated 5,570. A study released three weeks earlier found Los Angeles County’s homeless population rose 12 percent in the past year, to almost 59,000—despite massive new spending to combat the crisis.

California is home to almost 25 percent of the nation’s homeless population, yet makes up only 12 percent of the total population.

Obviously, California’s homeless need more housing. That’s why in 2018 I co-authored Senate Bill 1206, the No Place Like Home Act, with then-Sen. Kevin de Leon (D-Los Angeles).

The bill resulted in Proposition 2, last November’s successful ballot measure. It provided $2 billion in funding for housing mentally ill homeless people.

But housing is just a part of the answer. Another major problem is mental illness, which drives many homeless people to live on the street. Why are they allowed to stay there?

The problem stems from civil commitment reforms created in the late 1960s that made it too difficult to care for individuals with serious mental illnesses if they refused treatment. As a result, many institutions that involuntarily housed mentally ill people were closed.

Reforms began with the 1967 Lanterman-Petris-Short Act, written as a reaction to abuses occurring at the time. The LPS Act changed our civil commitment process in California. The result? Mentally ill individuals migrated to the streets, then often to county jails. Then and now, the outcome is not humane.

In April, Dr. Drew Pinsky, a noted psychiatrist with many years of clinical practice, explained the situation to me on his radio show.

“Psychiatric symptoms are given privileged positions in the law,” he said. “Not just the pathology, but the actual symptoms themselves are being privileged over the well-being of the individual displaying those symptoms, the safety of that individual, our ability to render care to them and the safety and sanitation of the surrounding community.”

Basically, our society has decided that someone shouting aimlessly on the street and eating out of garbage cans is not cause to treat him or her involuntarily for mental health issues.

I was on Pinsky’s show to advance SB 640, which I authored at the doctor’s suggestion. SB 640 sought to clarify the definition of “gravely disabled” and tie in an individual’s capacity to make informed decisions about his or her personal well-being.

The bill was shelved this year, but these definitional changes would have expanded treatment opportunities for our most vulnerable, put them into conservatorships and housing involuntarily, and helped diminish the inhumane neglect they currently suffer.

My office is putting together research for when the Senate reconsiders SB 640 next year. In January, an audit of the 1967 LPS Act should be finished. Let’s hope the State Auditor provides recommendations to help the Legislature reassess what the state must do.

Cost is another concern. As an accountant, I take money seriously. Currently, under Section 5150 of the state Welfare and Institutions Code, a person can be held involuntarily for up to 72 hours “for assessment, evaluation, and crisis intervention, or placement for evaluation and treatment in a facility designated by the county.”

If that period of holding is extended, hospitals are concerned their costs will rise.

So it’s imperative to locate funding sources. Private charities are crucial. In Orange County, where I was a county supervisor from 2006 to 2014, Mind OC and Be Well OC help find beds for those who need special assistance. And the county is one of the few that has a county-operated health system and is using CalOptima dollars to provide solutions.

Another source could be the Mental Health Services Act, passed by voters in 2004 as Proposition 63, which imposed a 1-percent tax on incomes of $1 million or greater.

While an Orange County supervisor in 2013, I worked with then-State Sen. Darrell Steinberg to pass SB 585. It allowed money from the Mental Health Services Act to fund Laura’s Law, a 2002 state law that created “an assisted outpatient treatment program for any person who is suffering from a mental disorder and meets certain criteria.”

Resources are available, but the problem always returns to the purported civil rights issue—that mentally ill homeless people have a right to refuse all treatment.

As Pinsky said, this is “privileging pathology over wellness.” From his clinical experience, he explained, when people finally get treated for their mental condition, “They’re furious when that happens. They go, ‘People left me in that condition? And look how good I am now? Who did that?’”

We don’t let our seniors with dementia fend for themselves. Why would we do the same with our severely mentally ill?

Homelessness clearly needs a two-pronged solution: first, more involuntary housing; second, reform of the 1967 LPS Act.

I’ll be working to improve the language in SB 640. The public has to understand that stranding people with serious mental illnesses on our streets is crueler than housing and treating them against their will.

As homelessness keeps getting worse, the need for this solution will become more obvious.

Sen. John M.W. Moorlach (R-Costa Mesa) represents the 37th District in the California State Senate. His Sacramento office phone number is (916) 651-4037 and his website is


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