Apart for the humane concerns, another major impetus behind deinstitutionalization was the cost of running asylums and facilities. The MHSA was intended to supplement state provisions with federal grants to support and maintain community mental health facilities. When those federal grants fell through, many states just didn't bother with expanding mental health facilities on their own provisions. I'm sure it's the case that some communities resisted these facilities, but that is not always an impediment. DC, for example, recently built and refurbished homeless shelters in every city ward.