Between March 1996 and December 1997 the State of Texas Department of Mental Health and Mental Retardation, set up the Texas Integrated Funding Initiative to develop local organized service-delivery systems for children with multiple needs that are family based, accountable for outcomes, and that maximize all funding sources.

The Texas Integrated Funding Initiative had three pilot sites. They were located in: Travis County, Brown County and the Riceland region south of Houston. Each pilot site offered opportunities and challenges in testing new financial and systems development approaches.

The project was part of the Robert Wood Johnson Foundation's (RWJF) national program Mental Health Services Program for Youth Replication.

Key Results:

• Each site used the Texas Integrated Funding Initiative to get out of categorical funding and build community-based services.
• In keeping with the principle that local control would produce better outcomes on every level, the Texas Integrated Funding Initative supported the sites in creating governance structures that build on their current interagency infrastructures.
• Rather than designate a lead agency to receive pooled funds, each of the sites chose to create a new locally controlled nonprofit agency that could receive public funds. At each site, the funds being pooled included state, local, and federal dollars.
  • In Travis County, this agency, the Travis County Children's Mental Health Partnership, was composed of representatives from child welfare, education, mental health, juvenile justice, city and county health and human services, and consumer family members.
  • In Riceland's nonprofit, Families First, there was a similar composition with the addition of participation from the local substance abuse council.
  • The nonprofit formed in Brownwood, the Family Services Center, had broader representation with participation from private business and community leaders.
• In all sites, the purpose of the new interagency nonprofits was to:
  • Develop the structure for purchasing and/or arranging services.
  • Determine the funding strategy, including rate setting.
  • Designate funds to the fund pool.
  • Ensure family representation and voice.
  • Establish share outcomes.
  • Designate target population for the services.
• All the sites planned for full operation of their models by January of 1998.

Afterward: In May 1999, the Texas Legislature passed a bill directing the Department of Mental Health and Mental Retardation to conduct a pilot study of the effectiveness of intensive community-based services options for children and families in decreasing the use of and/or length of stay in residential treatment.

A rider to the bill also required the Texas Department of Mental Health and Mental Retardation to evaluate the cost, efficacy, and benefits to children and families of the sites in the pilot study, in collaboration with the Texas Health and Human Services Commission and the Department of Protective and Regulatory Services.

The Texas Integrated Funding Initiatives two operational pilot sites, in Austin/Travis County and Brownwood/Brown County, were selected for the pilot study. Evaluation results were scheduled to be available in August 1999.