Requiring the commissioner of health to administer a demonstration project providing grants to fund children's mental health screening, diagnosis and treatment activities in selected areas of the state to identify children at risk of developing a mental health disorder and to provide timely intervention services and mental health treatment, specifying certain required uses of the grant funds and entity grant eligibility requirements; requiring the commissioner to award the grants using a request for proposal system and to consult with the commissioner of human services and the state advisory council on mental health in request design and grant awards; specifying certain grant application and award requirements; participation in a screening, diagnosis or treatment program to be voluntary, requiring parental consent for participation; specifying certain grant recipient data collection and maintenance requirements; requiring collaborative evaluation of the program by the commissioner of health, grant recipients and the state advisory council and subsequent commissioner recommendations to the legislature by a certain date on continued state funding for the programs, expansion of the demonstration project statewide and ways to increase the efficacy and cost effectiveness of future programs; requiring grant recipients to obtain funding from other sources for supplementation purposes (mk)