Declares that the goal of the council is to investigate and promote cost-effective approaches to meeting the long-term needs of adults and juveniles with mental disorders who are likely to become offenders or who have a history of offending. The council shall: (1) Identify strategies for preventing adults and juveniles with mental health needs from becoming offenders;

(2) Identify strategies for improving the cost-effectiveness of services for adults and juveniles with mental health needs who have a history of offending; and

(3) Identify incentives to encourage state and local criminal justice, juvenile justice, and mental health programs to adopt cost-effective approaches for serving adults and juveniles with mental health needs who are likely to offend or who have a history of offending.

Directs the department of corrections to submit a biennium budget request in an amount of not less than two hundred thousand dollars in 2007 and each biennium budget request thereafter that the council on mentally ill offenders is operating and reporting as required to support the activities and work of the council.

Appropriates the sum of one hundred thousand dollars, or as much thereof as may be necessary, for the biennium ending June 30, 2007, from the general fund to the department of corrections for the purposes of funding the council on mentally ill offenders for the purposes of this act.