                                 CODE OF VIRGINIA

PERFORMANCE CONTRACT FOR MENTAL HEALTH, DEVELOPMENTAL, AND SUBSTANCE ABUSE
SERVICES (§ 37.2-508)

A. The Department shall develop and initiate negotiation of the performance
contracts through which it provides funds to community services boards to
accomplish the purposes set forth in this chapter. In the case of operating
boards, the Department may, notwithstanding any provision of law to the
contrary, disburse state and federal funds appropriated to it for mental health,
developmental, or substance abuse services directly to the operating board, when
that operating board is authorized by the governing body of each city or county
that established it to receive such funds. Six months prior to the end of an
existing contract or, if no contract exists, six months prior to the beginning
of each fiscal year, the Department shall make available to the public the
standard performance contract form that it intends to use as the performance
contract for that fiscal year and solicit public comments for a period of 60
days. Such contracts shall be for a fixed term and shall provide for annual
renewal by the Board if the term exceeds one year.

B. Any community services board may apply for the assistance provided in this
chapter by submitting to the Department its proposed performance contract
together with (i) the approval of its board of directors for operating and
administrative policy boards or the comments of the local government
department&#8217;s policy-advisory board and (ii) the approval of the contract
by formal vote of the governing body of each city or county that established it.
The community services board shall make its proposed performance contract
available for public review and solicit public comments for a period of 30 days
prior to submitting its proposed contract for the approval of its board of
directors for operating and administrative policy boards or the comments of the
local government department&#8217;s policy-advisory board. To avoid disruptions
in service continuity and allow sufficient time to complete public review and
comment about the contract and negotiation and approval of the contract, the
Department may provide semi-monthly payments of state-controlled funds to the
community services board. If the governing body of each city or county does not
approve the proposed performance contract by September 30 of each year, the
performance contract shall be deemed approved or renewed.

C. The performance contract shall:

   1. Delineate the responsibilities of the Department and the community services
   board;

   2. Specify conditions that must be met for the receipt of state-controlled
   funds;

   3. Identify the groups of individuals to be served with state-controlled
   funds;

   4. Set forth specific goals and objectives related to the delivery of services
   to individuals with mental illness, developmental disabilities, or substance
   use disorders that are consistent with the purposes set forth in &#xA7;
   37.2-500;

   5. Contain specific relevant, and measurable performance measures to assess
   the experiences and outcomes of individuals receiving services through
   community services boards;

   6. Contain relevant benchmarks and monitoring activities for each performance
   measure;

   7. Contain mechanisms that have been identified or developed jointly by the
   Department and community services board and that will be employed
   collaboratively by the community services board and the state hospital to
   manage the utilization of state hospital beds;

   8. Contain provisions that enable the Department to enforce the performance
   contract in the event that the community services board fails to substantially
   comply with the requirements of its performance contract, which shall include:
   				a. Provisions to ensure that the executive director and chairman of the
   community services board are notified when the community services board fails
   to substantially comply with the requirements of its performance contract;
   				b. A remediation process to allow the community services board, after
   failing to substantially comply with its performance contract, to come into
   substantial compliance with its performance contract;
   				c. Provisions for withholding or reducing funds, repayment of funds, or
   termination of all or part of a performance contract in accordance with the
   provisions of subsection E in the event that the community services board
   fails to come into substantial compliance with the provisions of its
   performance contract despite utilization of the remediation process described
   in subdivision b; and
   				d. Provisions for appeal of an enforcement action undertaken by the
   Department; and

   9. Include requirements for the community services board to report specific
   information about (i) its revenues, costs, and services provided; (ii)
   individuals served; and (iii) any other information deemed necessary by the
   Department, which shall be displayed in a consistent, comparable format
   developed by the Department.

D. The Department shall develop and implement a process for regular, ongoing
monitoring of the performance of community services boards to ensure compliance
with the requirements of performance contracts entered into pursuant to this
section.

E. If a community services board fails to substantially comply with the
requirements of its performance contract, the Department shall utilize the
remediation process described in the performance contract to allow the community
services board to come into substantial compliance. The Department shall notify
the Board and the chairman of the community services board upon initiation of
the remediation process and provide to the Board and chairman regular updates
regarding the community services board&#8217;s progress toward coming into
substantial compliance.
			If a community services board fails to come into substantial compliance after
utilization of the remediation process, the Department shall, after affording
the community services board an adequate opportunity to use the appeal process
described in the performance contract, terminate all or a portion of the
performance contract.

F. Upon terminating all or a portion of a performance contract pursuant to
subsection E, the Department may, using the state-controlled resources
associated with that performance contract and after consulting with the
governing body of each city or county that established the community services
board that was a party to the performance contract, negotiate a performance
contract with another community services board, a behavioral health authority,
or a private nonprofit or for-profit organization or organizations to obtain
services that were the subject of the terminated performance contract.

G. No community services board shall be eligible to receive state-controlled
funds for mental health, developmental, or substance abuse services after
September 30 of each year unless (i) its performance contract has been approved
or renewed by the governing body of each city or county that established it and
by the Department; (ii) it provides service, cost, and revenue data and
information, and aggregate and individual data and information about individuals
receiving services, notwithstanding the provisions of &#xA7; 37.2-400 or any
regulations adopted thereunder, to the Department in the format prescribed by
the Department; (iii) it uses standardized cost accounting and financial
management practices approved by the Department, and (iv) the community services
board is in substantial compliance with its performance contract or is making
progress to become in substantial compliance through the Department&#8217;s
remediation process.

HISTORY: 1968, c. 477, § 37.1-198; 1970, c. 346; 1972, c. 498; 1976, c. 671;
1980, c. 582; 1986, c. 176; 1998, c. 680; 2005, cc. 75, 716; 2012, cc. 476, 507,
805, 836; 2023, cc. 484, 754, 790.