Senate committee substitute makes the following changes to the 1st edition.

Changes the long title.

Amends GS 122C-3(20c), providing that an LME/MCO is defined as an LME/MCO that is under contract with the Department of Health and Human Services (Department) to operate the combined Medicaid Waiver program (previously, defined as an LME that has been approved by the Department).

Amends GS 122C-20.5, amending the definition for In-reach activities, providing that the term does not include education or information provided by adult care homes (previous edition stated it did not include education or information provided by adult care homes or state psychiatric hospitals to residents).  Deletes the term and definition for Institution for mental disease.

Amends GS 122C-20.8, Eligibility requirements for NC Supportive Housing Program (Program), providing that the Division of Aging and Adult Services (Division) (was, the Commission on Mental Health, Developmental Disabilities, and Substance Abuse Services) will adopt rules to establish eligibility for the program. Directs the Division to adopt temporary rules necessary to implement this article. Makes a technical change. Deletes GS 122C-20.15, Rules to implement NC Supportive Housing Program, as included in the previous edition and makes organizational changes accordingly.

Amends GS 122C-20.9, In-reach activities for supportive housing, providing that LME/MCOs have an ongoing responsibility to report back to the Department on the LME/MCO's recommended list of program participants on a daily basis (was, monthly).

Amends GS 122C-20.10, Allocation of supportive housing slots to LME/MCOs, making a technical change.

Amends GS 122C-20.11, Transition of program participants into housing slots, making a clarifying change.

Amends GS 12C-20.13, Approval of landlords and housing units, providing that the application process for landlords must include an inspection of the owners' selected housing units (was, all of the owner's available housing units) and a requirement that owners receive education information from the NC Supportive Housing Program prior to being approved as landlords (previously, owners were required to complete training).

Enacts GS 122C-20.15 (previously, 122C-20.16), Annual reporting on NC Supportive Housing Program, providing that the Department will annually, on October 1, report to the General Assembly on the numbers of individuals within each catchment area who transitioned into housing slots available through the Program (was, each LME/MCO was required to report annually on April 1 to the Department). Deletes a requirement for the Department to annually report to the General Assembly on the effectiveness of the Program.

Deletes GS 122C-20.17, Department not obligated to provide unlimited number of housing slots.

Enacts new GS 122C-20.16, NC Supportive Housing Program not an entitlement, providing that the Department will not be required to provide housing slots to individuals beyond the number that can be supported by funds appropriated by the General Assembly for this purpose. Establishes that this Program is not an entitlement and no property rights are created.

Amends the appropriations of the act, providing that $3,835,280 is appropriated from the General Fund to the Department (was, to Transitions to Community Living Housing Budget) for fiscal year 2013-14, and $5,876,000 for fiscal year 2014-15.

Amends GS 122E-3A, changing title to Community Living Housing Fund (was, Transitions to Community Living Housing Budget). Deletes the terms Individuals with disabilities and Transitions to Community Living Fund (Fund) from the definitions section. Provides that the Community Living Housing Fund is established within the Housing Finance Agency (previously, this section established the Transitions to Community Living Housing Budget within the Transitions to Community Living Fund) to pay for the transition of individuals diagnosed with severe mental illness or severe and persistent mental illness from institutional settings to integrated, community-based supported housing and to increase the percentage of targeted housing units available to individuals with disabilities for use in the Program. Amends the purposes for which the monies of the Fund can be used, providing that they must be used to either provide permanent community-based housing in integrated settings appropriate for individuals with severe mental illness and severe and persistent mental illness or to support an increase in the number of targeted units for individuals with disabilities in housing projects funded by the Housing Finance Agency from 10% to 15%. Also provides that any additional targeted units funded must be made available to the Department for use in the Program. Makes conforming changes.

Amends GS 168-18, deleting individuals who have intellectual or developmental disabilities from the definition for individuals with disabilities. Makes a technical change.

Appropriates from the General Fund to the Transitions to Community Living Fund $150,000 for the 2014-15 fiscal year (previous edition appropriated funds from the General Fund to the Community Living Housing Budget and included a $200,000 appropriation for 2013-14).  Provides that these funds will also be used to pay for assistive technology devices for individuals with disabilities who are transitioning from institutional settings (previous edition provided the funds could be used for assistive technology assessments only).

Amends the enactment clause, changing effective dates, providing that Section 3 of the act becomes effective July 1, 2014, with Section 5(b) becoming effective July 1, 2013, with the remainder effective when the act becomes law.