(a) In this section:
(1) “Inpatient mental health facility” has the meaning assigned by § 571.003, Health and Safety Code.
(2) “Program” means the grant program established under this section.
(3) “State hospital” has the meaning assigned by § 552.0011, Health and Safety Code.
(b) To the extent money is appropriated to the commission for that purpose, the commission shall establish a matching grant program to provide support to eligible entities for community-based initiatives that promote identification of mental health issues and improve access to early intervention and treatment for children and families. The initiatives may:
(1) be evidence-based or otherwise demonstrate positive outcomes, including:
(A) improved relationship skills;
(B) improved self-esteem;
(C) reduced involvement in the juvenile justice system;
(D) participation in the relinquishment avoidance program under Subchapter E, Chapter 262, Family Code; and
(E) avoidance of emergency room use; and
(2) include:
(A) training; and
(B) services and supports for:
(i) community-based initiatives;
(ii) agencies that provide services to children and families;
(iii) individuals who work with children or caregivers of children showing atypical social or emotional development or other challenging behaviors; and
(iv) children in or at risk of placement in foster care or the juvenile justice system.

(c) The commission may award a grant under the program only in accordance with a contract between the commission and a grant recipient. The contract must include provisions under which the commission is given sufficient control to ensure the public purpose of providing mental health prevention services to children and families is accomplished and the state receives the return benefit.
(d) The executive commissioner by rule shall establish application and eligibility requirements for an entity to be awarded a grant under the program.
(e) The following entities are eligible for a grant awarded under the program:
(1) a hospital licensed under Chapter 241, Health and Safety Code;
(2) a mental hospital licensed under Chapter 577, Health and Safety Code;
(3) a hospital district;
(4) a local mental health authority;
(5) a child-care facility, as defined by Chapter 42, Human Resources Code;
(6) a county or municipality; and
(7) a nonprofit organization that is exempt from federal income taxation under Section 501(a), Internal Revenue Code of 1986, by being listed as an exempt entity under Section 501(c)(3) of that code.
(f) In awarding grants under the program, the commission shall prioritize entities that work with children and family members of children with a high risk of experiencing a crisis or developing a mental health condition to reduce:
(1) the need for future intensive mental health services;
(2) the number of children at risk of placement in foster care or the juvenile justice system; or
(3) the demand for placement in state hospitals, inpatient mental health facilities, and residential behavioral health facilities.
(g) The commission shall condition each grant awarded under the program on the grant recipient providing matching money in an amount that is equal to at least 10 percent of the grant amount.
(h) A grant recipient may only use grant money awarded under the program and matching money provided by the recipient to develop innovative strategies that provide:
(1) resiliency;
(2) coping and social skills;
(3) healthy social and familial relationships; and
(4) parenting skills and behaviors.
(i) A grant recipient may not use grant money awarded under the program or matching money provided by the recipient to:
(1) reimburse an expense or pay a cost that another source, including the Medicaid program, is obligated to reimburse or pay by law or under a contract; or
(2) supplant or be a substitute for money awarded to the recipient from a non-Medicaid federal funding source, including federal grant funding.
(j) A Medicaid provider’s receipt of a grant under the program does not affect any legal or contractual duty of the provider to comply with requirements under the Medicaid program.
(k) The commission may use a reasonable amount of the money appropriated by the legislature for the purposes of the program, not to exceed five percent, to pay the administrative costs of implementing and administering the program.