BILL ANALYSIS Ó
AB 2286
Page 1
Date of Hearing: April 18, 2012
ASSEMBLY COMMITTEE ON EDUCATION
Julia Brownley, Chair
AB 2286 (Bonilla) - As Introduced: February 24, 2012
SUBJECT : Child care: reimbursement rate adjustment factors
SUMMARY : Increases the rates for subsidized child care
services for infant and toddler care. Specifically, this bill :
1)Increases the adjustment factor for infants 0 to 18 months of
age served in a child day care center from 1.7 to 2.3.
2)Increases the adjustment factor for toddlers who are 18 to 36
months of age served in a child day care center from 1.4 to
1.8.
EXISTING LAW :
1)Establishes eligibility for child care services and child
development programs administered by the California Department
of Education (CDE) and requires the Superintendent of Public
Instruction (SPI) to adopt rules and regulations on
eligibility, enrollment and priority of services needed for
implementation (Education Code (EC) Section 8263).
2)Requires the SPI to implement a plan that establishes
reasonable standards and assigned reimbursement rates, which
vary with the length of the program year and the hours of
service. Requires the standard reimbursement rate (SRR) to be
$3,523 per unit of average daily enrollment for a 250-day
year, increased by a cost-of-living adjustment granted by the
Legislature beginning July 1, 1980. (EC Section 8265)
3)Specifies that in order to reflect the additional expense of
serving children in specified categories, the provider
agency's reported child days of enrollment for these children
shall be multiplied by specified adjustment factors, including
1.7 for infants and 1.4 for toddlers. (EC Section 8265.5)
FISCAL EFFECT : Unknown
COMMENTS : Background . Federal and state-funded child care
services are administered by both the Department of Social
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Services (DSS) and the CDE. In fiscal year (FY) 2011-12, $2.017
billion was provided for child care and development programs
from state and federal funds, enrolling an estimated 345,000
children from birth through age 12. This is down from $2.669
billion initially provided in the FY 2010-11 budget (prior to
midyear trigger cuts) with almost 416,000 slots.
Regional Market Rates (RMR) . Eligible families can receive
vouchers that enable them to choose a licensed center, licensed
family child care homes, or license-exempt care (e.g., care by a
relative). The voucher program is administered by Alternative
Payment Programs (APPs) selected by the CDE. Child care
licensed providers must comply with Title 22 regulations
developed by the California Department of Social Services and
receive reimbursements of up to 85th percentile of child care
rates charged by private providers in the area.
The rates are determined by the RMR survey and vary depending on
the geographical location of the provider. According to the
CDE, the RMR is a survey of licensed centers and family child
care homes based on measurements of child care rates of similar
socioeconomic conditions, rather than geographic proximity,
creating ''price profiles" of similar zip codes. Ceilings are
established for each county according to estimates of the 85th
percentile of child care rates for groups of centers and family
child care homes. These county market rate ceilings are
differentiated by the age of the child, full-time or part-time
care, and frequency of care. The rate is intended to enable
access to 85% of all licensed providers in a county. State and
federal law requires the survey to be updated every two years.
However, due to budgetary reasons, the current RMR is still
based on the 2005 survey. The Governor's proposed FY 2012-13
budget reduces rates to the 50th percentile of RMR using the
2009 survey. The Legislative Analyst's Office (LAO) estimates
that the effective reduction to rates would be between 12 to 14
percent, on average.
Standard Reimbursement Rate (SRR) . Child development programs
and preschools that contract directly with CDE must comply with
Title 5 regulations developed by the CDE and receive the SRR.
The current SRR, which was last adjusted in 2007-08, is $34.38
per day for full-day care (or $8,595 annually) and $21.22 per
day per child for preschool (or $3,714 annually). The
Governor's proposed fiscal year 2012-13 budget proposes to
reduce the SRR by 10 percent, dropping the per-child rate for
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full-day services to $30.94 and the preschool rate to $19.10.
The LAO recommends rejecting the Governor's proposal to reduce
the SRR. In its report, "The 2012-13 Budget: The Governor's
CalWORKs and Child Care Proposals," the LAO states:
"While parents and providers working with the voucher system
could respond to the proposed RMR reduction in a number of ways,
Title 5 centers receiving lower state reimbursements would have
no choice but to reduce their operating budgets. That is, state
requirements around adult-to-child ratios and days of operation
- and, in many cases, school district collective bargaining
agreements - leaving these centers little flexibility to
accommodate such a reduction. State law also prevents Title 5
centers from continuing to charge existing rates and asking
parents to make up the difference. Moreover, the state rate for
these centers already is somewhat low - in several areas in the
state, the SRR currently is lower than the rates charged by the
majority of other providers in the county."
Adjustment factor . Current law authorizes an adjustment
increase in the SRR, recognizing that there are higher costs to
serve certain populations, including the following:
Infants (0 - 18 months): 1.7
Toddlers (18 - 36 months): 1.4
Infants and Toddlers in Family child care home:1.4
Children with exceptional needs (0 to 21 years):1.2
Severely disabled children (0 - 21 years):1.5
Child at risk of neglect, abuse, or exploitation (0 - 14): 1.1
Limited-English-speaking (2 - kindergarten age)1.1
This bill increases the adjustment factors for infants to 2.3
and toddlers to 1.8. The author states, "The reimbursement
rates paid by the State for center based infant/toddler
educational/
developmental child care to California Department of Education
contractors are exceptionally low, and grossly inadequate.
Community agencies and school districts have long lost money on
infant and/or toddler classrooms. As a result there has been a
long, slow process of agencies closing infant and toddler
classrooms - even at times when the Legislature was attempting
to expand infant and toddler child care and development. But
this year a very large number of infant and toddler classes were
closed - as a result of the major cuts to child development in
the 2011-12 budget. Agencies made a rationale decision: if
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they had to close some classes, they chose to close the classes
on which they were losing money."
The following chart provided by the CDE shows the decrease in
enrollment of infant and toddlers over the last three years:
--------------------------------------------------
| Infant/Toddler Center-Based Title 5 Enrollment |
--------------------------------------------------
|---------------+----------+-----------+-----------|
| | Oct-09 | Oct-10 | Oct-11 |
|---------------+----------+-----------+-----------|
|0-11 MONTHS OF | | | |
|AGE | ?? | ?? | ?? |
| | 2,207 | | |
| | | 1,907 | 1,521 |
|---------------+----------+-----------+-----------|
|12-17 MONTHS | | | |
|OF AGE | ?? | ?? | ?? |
| | 2,337 | 2,241 | |
| | | | 1,850 |
|---------------+----------+-----------+-----------|
|18-35 MONTHS | | | |
|OF AGE | ?? | ?? | ?? |
| | 14,058 | 13,585 | 11,408 |
|---------------+----------+-----------+-----------|
|Total | | | |
| | ?? | ?? | ?? |
| | 18,602 | 17,733 | 14,779 |
--------------------------------------------------
--------------------------------------------------
|Source: CD-801A Monthly Child Care Report, |
|October 2009 (archived data), October 2010 |
|(archived data), and October 2011 (preliminary |
|data). |
|--------------------------------------------------|
|Note: Data represent a "point-in-time" and do |
|not reflect annual aggregate figures. Counts |
|represent the total number of unduplicated |
|children served in Center-Based Title 5 programs |
|under the age of 36 months. |
--------------------------------------------------
Contractors are allocated a contract amount and make their own
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decisions on the classes to offer. The decrease may likely be
due to providers offering fewer infant and toddler classes. The
decrease is also likely to be due to budget reductions. Since
2008, the state has eliminated funding for approximately 20
percent of slots. Infant and toddler classes, pursuant to Title
5 regulations, require lower staff to children ratios and higher
staff qualifications. Specifically, infant rooms must be
staffed by one teacher to three infants and one teacher to four
children in toddler rooms, while the requirement for preschool
rooms is one teacher to eight children.
The sponsor of the bill, the California Child Development
Administrators Association (CCDAA), argues that the adjustment
factors are too low. To achieve "parity" or the "equivalence"
with the rate for preschool children, the adjustment factors
need to increase from 1.7 to 2.3 for infants and 1.4 to 1.8 for
toddlers. The CCDAA defines "equivalent funding" as the factors
that would "allow agencies to pay the same salaries and benefits
to staff who are required to have the same level of educational
qualifications, regardless of whether they work in an infant,
toddler or preschool classroom."
The adjustment factor was last increased in 1994. AB 3781
(Brulte), Chapter 588, Statutes of 1994, separated the
adjustment factor for child day care centers for infants,
defined as age 0 to 18 months, from toddlers, defined as age 18
to 36 months and increased the adjustment factors to 1.7 and 1.4
respectively. Prior to the enactment of AB 3781, there was one
adjustment factor rate for infants and toddlers from age 0 to 36
months at 1.4.
The chart below shows the current adjusted rates and the rates
as proposed by this bill based on 250 days of service:
--------------------------------------------------------------------------------------------------------
| | Current | Per Day | Per Annum | Proposed | Per Day | Per Annum |
| | Adjustment | | | Adjustment | | |
| | Factor | | | Factor | | |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|Infants | 1.7 | $58.45 | $14,612.50 | 2.3 | $79.07 | $19,767.50 |
|--------------+--------------+--------------+--------------+--------------+--------------+--------------|
|Toddlers | 1.4 | $48.13 | $12,032.50 | 1.8 | $61.88 |$15,470 |
| | | | | | | |
--------------------------------------------------------------------------------------------------------
AB 2286
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Need for infant/toddler child care . According to the California
Child Care and Resource and Referral Network, of the total
705,077 slots available in 2010, the fewest available slots,
40,337, were for infant slots, while the highest demand (35%) of
child care requests were for care under two years of age.
Arguments in support . Options - A Child Care and Human Services
Agency states, "State funded infant and toddler center based
programs are severely underpaid for each child they serve, and
the school districts and non-profit agencies sponsoring these
centers lose money weekly due to the grossly inadequate funding
rate. ÝThis] bill will save infant and toddler centers from
extinction. The rate of closing of these centers is so severe,
that even in a time of great financial stress for the State
budget, the Legislature must immediately address this crisis.
If the Legislature waits, there will be no infant and toddler
centers left to save."
Children Now states, "Learning begins at birth, yet only a small
number of our state's low-income infant and toddlers have access
to quality early learning programs in center-based settings.
The higher cost of care, due mainly to smaller adult-child
ratios, coupled with previous budget cuts have forced many
centers to stop offering infant and toddler classrooms
altogether. Approximately 16,000 slots, or 13% of state funded
early care and education funding, is allocated to our children
under 3?.In order to maintain and improve quality early learning
programs, centers should be paid for the true costs of providing
that care. AB 2286 is a fiscally responsible move in that
direction."
Previous legislation . SCR 47 (DeSaulnier), Resolution Chapter
78, Statutes of 2010, states the intent of the Legislature to
increase the funding of child development centers and preschools
in future years, as resources become available, in order to
provide staff of Title 5 child development centers and
preschools with adequate salaries and benefits, provide adequate
resources to support program quality for children, and keep
programs open to serve parents and children.
AB 3781 (Brulte), Chapter 588, Statutes of 1994, separated the
adjustment factor in child day care centers for infants, defined
as age 0 to 18 months, from toddlers, defined as age 18 to 36
months and increased the adjustment factors to 1.7 and 1.4
respectively.
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REGISTERED SUPPORT / OPPOSITION :
Support
California Child Development Administrators Association
(sponsor)
California Child Care Coordinators Association
California Child Care Resource & Referral Network
Child Development Policy Institute
Children Now
First Baptist Head Start
Options - A Child Care and Human Services Agency
Preschool California
Professional Association for Childhood Education
San Mateo County Child Care Partnership Council
Santa Barbara County Child Care Planning Council
Santa Barbara County Education Office
ZERO TO THREE
Opposition
None on file
Analysis Prepared by : Sophia Kwong Kim / ED. / (916) 319-2087