Mesa County claims in a new lawsuit that the state Behavioral Health Administration shorted the county $1.3 million in grant funds that were supposed to pay for mental health services, including a co-responder program that paired clinicians with law enforcement.
The state, meanwhile, says Mesa County failed to prove that it was spending the money within the rules.
The dispute that has dragged on since April 2025, when the state stopped sending monthly grant payments, is now the subject of a lawsuit that the Western Slope county filed against the state administration March 31.
“To be holding $1.3 million of our taxpayers’ money, that’s impacting our ability to fill potholes and provide services as a county,” Mesa County Attorney Todd Starr said in an interview.
Starr, who has been an attorney for five Colorado counties, said it’s unclear exactly what the problem is with Mesa County’s billing practices but that it’s normal for counties to use state grant funds to pay subcontractors for services. “What’s not normal is the absolute lack of communication of what the issue is,” he said.
“If they would just communicate to us and say, ‘Here are our specific concerns,’ we could have taken care of it.”
Starr said he tried calling the Behavioral Health Administration before suing them, but “nobody would even come to take my call.”
The county and the Behavioral Health Administration signed a contract in September 2023 that the state would provide up to $3.4 million per year for behavioral health services in Mesa County. The money initially came from federal COVID relief funds.
The grant helped support a five-person Mesa County behavioral health department, which subcontracted with local mental health workers who provided therapy and other services. The contract included salaries for clinicians and case managers, as well as office remodeling and furniture, according to a copy reviewed by The Colorado Sun.
The state had 45 days after receiving Mesa County’s monthly invoices to either dispute the amount or pay it, the contract said. But a year ago, a few months before the contract was due to expire, the state stopped paying, according to the lawsuit filed in Denver.
Behavioral Health Administration officials requested revised invoices and documentation, which Mesa County officials say they provided, as well as a report from Mesa County addressing “non-duplication of billing” and other oversight issues. It’s unclear what potential misspending the state is looking into, but the requests for additional documentation focused on payments the county made to subcontractors who were providing the mental health services.
“These are local businesses that we were able to subcontract with to have a greater impact on the residents of our county that are in need of these types of services,” said Matt Lewis, deputy county administrator. “That was really the purpose of this, to unite everyone under a common purpose, coordinate care, and really make sure that no people were falling through the cracks.”
Since the grant money ended, the county shut down its behavioral health department and its five employees lost their jobs or transferred to other departments. The Mesa County Sheriff’s Office took over the co-responder program, so the mental health clinicians who had been working under the county behavioral health department now work for the sheriff’s department, which is seeking new sources of grant funding.
The state Behavioral Health Administration has not yet filed a response to the lawsuit, but spokesperson George Laumeyer told The Sun that the administration has been “working in good faith with Mesa County since last year” without resolution.
“The funds in question are tied to federal requirements, which include multiple layers of oversight, accountability, and compliance,” he said via email. “The grant payments were paused because Mesa County was not submitting documentation required to fulfill the grant agreement. Until the necessary documentation is provided, further payments cannot be made.”
He added that access to behavioral health services on the Western Slope “remains a top priority.”
Mesa County sent a letter to the state in January demanding within 15 days the $1.3 million in invoices that had gone unpaid. It has not received that money from the state.
“It has been over 120 days since the audit-revised invoices were submitted and nearly nine months since the initial January invoices were filed,” the letter says. “This delay is an unacceptable departure from the grant agreement.”
Lewis said it’s been months of back and forth and resubmitting documents the state has requested.
“Here we are in May and we still don’t know why we haven’t been paid,” he said.
Type of Story: News
Based on facts, either observed and verified directly by the reporter, or reported and verified from knowledgeable sources.