BILL ANALYSIS                                                                                                                                                                                                    



                                                                     AB 188


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          Date of Hearing:  April 29, 2015


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                                 Jimmy Gomez, Chair


          AB  
          188 (Cristina Garcia) - As Introduced January 27, 2015


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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          SUMMARY:  


          This bill increases the allowable reimbursable amount included  
          in contracts for alternative payment programs (APPs) for child  
          care by adding 3% for making eligibility determinations. 









                                                                     AB 188


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          FISCAL EFFECT:


          Significant costs of approximately $36 million (GF) to increase  
          the reimbursement rate by 3%.


          COMMENTS:


          1)Purpose.  According to the author, "APPs are only funded based  
            on the reimbursements to providers that are actually 'put out  
            the door' in the form of a child care payment.  The child care  
            payment is made once a working family is deemed income  
            eligible for a child care subsidy and has chosen a child care  
            provider.  All of the work leading up to the actual enrollment  
            of an income eligible family that will result in a child care  
            payment to a provider is not reimbursed?Without a remedy, APPs  
            will experience greater caseworker turnover and families  
            needing child care will have to wait longer?"  This bill seeks  
            to increase funding to APPs for their administrative work. 



          2)Background.  There are currently 76 APPs contracted with the  
            California Department of Education (CDE), funded through state  
            and federal funds, to provide an array of support and payment  
            services that enable eligible low-income families to access  
            subsidized child care.  APPs administer vouchers and case  
            manage the families in CalWORKs Stages 2 and 3 as well as the  
            APP. These administrative agencies process the payments for  
            the vouchers, insure compliance from providers, and assist  
            families in finding the right child care for their children.  
            APPs can charge up to 17.5 percent of the total contract for  
            these services.  This rate was reduced from 19 percent in the  
            2010-11 budget as a cost saving tool.

            APPs have shrunk, consolidated, and even ceased operating as  








                                                                     AB 188


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            the costs of operations have climbed while the number of  
            vouchers has shrunk, resulting in lower contract amounts.



          3)Governor's Budget.  The Governor's Budget increases spending  
            on child care and early childhood education programs by $101  
            million over the current year. The increase reflects an  
            increasing cost of care in the CalWORKs programs, increases in  
            the Regional Market Rate enacted last year, growth, and COLA. 

          Analysis Prepared by:Jennifer Swenson / APPR. / (916)  
          319-2081