BILL ANALYSIS Ó
AB 271
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Date of Hearing: March 24, 2015
ASSEMBLY COMMITTEE ON HUMAN SERVICES
Chu, Chair
AB
271 (Obernolte) - As Introduced February 10, 2015
SUBJECT: Child care: alternative payment programs and
contractors: electronic records
SUMMARY: Expands the authority granted under current law for
Alternative Payment Programs (APPs) and child care providers to
use electronic or other alternative methods for the storage of
records.
Specifically, this bill:
1)Authorizes APPs and child care providers, notwithstanding any
other law, to retain child care case records electronically or
through an alternative means.
2)Includes within the permissible alternative storage
technologies: photography, microphotography, electronically
recorded video images on magnetic surfaces, electronic data
processing systems, optical disk storage, or any other
electronic medium that is a trusted system.
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3)Requires any alternative storage technologies used to not
permit additions, deletions, or changes to the original
document and to meet all necessary state and federal laws for
recording of permanent records or nonpermanent records.
4)Requires a duplicate copy of any record reproduced to be
deemed an original.
5)Authorizes APPs and providers to use an electronic signature,
which can be a marking that is either computer generated or
produced by electronic means and is intended by the signatory
to have the same effect as a handwritten signature. Provides
that an e-mail signature may constitute an electronic
signature.
6)Deletes the requirement that child care contractors only be
authorized to store records electronically if the original
documents were created in electronic format. Additionally
expands the five-year requirement for the storage of original
records, as specified, to all records.
EXISTING LAW:
1)Establishes the California Child Care and Development Services
Act (CCDSA) to provide a comprehensive, community-based,
coordinated, and cost-effective system of child care and
development services for children from birth to age 13 with
the purpose of enhancing the social, emotional, physical, and
intellectual development of children. (EDC 8200 and 8201)
2)States the intent of the Legislature that all families have
access to child care and development services, regardless of
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their demographic background, in order to help them attain
financial stability through employment, while maximizing
growth and development of their children, and enhancing their
parenting skills through participation in child care and
development programs. (EDC 8202)
3)Defines child care and development services as care and
services designed to meet a wide variety of needs of children
and their families, while their parents or guardians are
working, in training, seeking employment, incapacitated, or in
need of respite. (EDC 8208(i))
4)Authorizes local government agencies or non-profit
organizations to contract with the California Department of
Education (CDE) to operate APPs and provide alternative
payments and support services to parents and child development
providers. (EDC 8220)
5)Establishes requirements and procedures APPs and child
development providers must follow as contracted agencies with
the CDE, including but not limited to tracking and reporting
of attendance, accounting and auditing requirements, and
reimbursement and payment procedures. (EDC 8221.5)
6)Requires any agency that contracts with CDE for the provision
of educational services to undergo a periodic audit regarding
the use of state and federal funds, as specified. (EDC 33420)
7)Requires agencies that receive state funds to, at the request
of the Superintendent of Public Instruction, make all records
pertaining to its state-funded programs available to the CDE,
as specified, and that all records be retained by each agency
for at least five years, as specified. (EDC 33421)
8)Permits APPs and child care providers to maintain records in
electronic format only if the original documents were created
in electronic format, as specified. (EDC 8227.3)
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9)Establishes the Uniform Electronic Transactions Act (UETA),
which permits, but does not require, a record or signature to
be created, generated, sent, communicated, received, stored,
or otherwise processed or used by electronic means or in
electronic form. (CIV 1633.1 et seq.)
FISCAL EFFECT: Unknown
COMMENTS:
Alternative Payment Programs: There are currently 76 APPs
contracted with the CDE, funded through state and federal funds,
to provide an array of support and payment services that enable
low-income, eligible families to access subsidized child care.
APPs do not provide direct child development services or
programs, rather they provide families who are participating in
welfare-to-work activities under the California Work
Opportunities and Responsibility to Kids (CalWORKs) program, or
who are low-income but do not qualify for CalWORKs, with
subsidized child care vouchers. Those child care vouchers can
be used to access child care at either a Title 5 or Title 22
child development center or with a license-exempt child care
provider who meets certain criteria. The voucher can only be
used at a Title 22 program that accepts them, whereas all
vouchers must be accepted at Title 5 programs.
Typically, a family that receives a voucher from an APP will
then be referred to a local child care resource and referral
(R&R) network. The R&R network, also funded through state and
federal dollars, will assist a family by helping to identify and
access the appropriate and desired child development program for
the child or children. However, due to lack of state resources
and ongoing cuts to child care, access to programs able to
accept vouchers is limited. Should the family be unable to find
appropriate care, they will be placed on a waiting list, if one
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is available.
Electronic records: SB 820 (Sher/Pavley), Chapter 428, Statutes
of 1999, enacted the Uniform Electronic Transactions Act (UETA),
which is described as the first comprehensive effort to prepare
state law for the electronic commerce era. Through this
legislation, California aligned itself with a process developed
by the Conference of Commissioners on Uniform State Laws to
govern electronic transactions, which generally applies to all
records or signatures that are generated or transmitted
electronically, the formation of contracts using electronic
records, the creation and retention of electronic records and
signatures, and the procedures governing changes and errors in
electronically-transmitted records. While the UETA does not
require records or signatures to be recorded or maintained
electronically, it does provide a process by which transactions
can occur electronically. Writing in explanation of the UETA,
the Conference of Commissioners on Uniform State Laws states
"UETA applies only to transactions in which each party has
agreed by some means to conduct them by electronically.
Agreement is essential. Nobody is forced to conduct to
electronic transactions."<1>
Fourteen years later, AB 274 (Bonilla) Chapter 733, Statutes of
2013, was adopted. Although AB 274 was not directly associated
with the further implementation of the UETA, it was initially
introduced to, among other changes, specifically allow APPs to
maintain records electronically in accordance with state and
federal auditing standards. It was later amended to limit the
electronic maintenance of records to only those that were
generated electronically. In December 2013, the California
Department of Education issued management bulletin 13-10
implementing the requirements of AB 274, which included
---------------------------
<1> The National Conference of Commissioners on Uniform State
Laws; Electronic Transactions Summary.
http://www.uniformlaws.org/ActSummary.aspx?title=Electronic+Trans
actions+Act
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additional guidance on what types of documents could be
generated and transmitted electronically. In this guidance, the
department explicitly states that "documents or records created
in paper form cannot be scanned and stored electronically.
These records must be stored in their original paper format."
Need for this bill: According to the author, "California leads
the nation when it comes to innovation and technology. However,
many of our state government operations have been left in the
past. As a result, a number of state agencies are forced to
operate in a manner that is both outdated and inefficient.
[This bill] would update an outmoded procedure by giving child
care agencies the option of saving and storing all of their
paperwork electronically. Providing child care programs with
this option would both modernize agency operations and maximize
the use of public dollars."
Staff comments: This measure seeks to further the AB 274
(Bonilla) effort by permitting all records to be maintained
electronically. However, it is unclear whether the bill will
achieve the desired outcome while also ensuring that the
electronic records meet state auditing requirements. In order
for an electronic record to be used and accepted, CDE, which is
the contracting agency, will have to agree to the use of
electronic documents and have the technology available to accept
such documents. Although the bill allows for APPs and child
care providers to use electronic records, it does not mandate
the CDE to accept or use them for purposes of programmatic or
fiscal compliance.
It is also unclear whether APPs and child care providers have
the financial and technological resources to comply with
industry standards of what is considered an authentic or
otherwise accurate and reliable electronic document. The
process of certifying that a particular agency's system of
developing and maintaining electronic records is trustworthy and
meets certain standards is costly, generally requiring a third
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party auditor or software firm to assess the system and provide
an adequate level of protections and quality assurances
necessary to meet state and federal auditing standards. This
would occur in addition to annual auditing requirements for
agencies already in statute.
While CDE supports efforts to transition to the collection and
use of electronic records, it lacks the capacity and resources
to adequately receive and verify electronically generated and
maintained records. Similar to the requirements for local
agencies, CDE would likely have to put in place a system that
allows for the receipt and use of electronic records for quality
assurance and auditing purposes, and a process to verify the
authenticity of those records. Without the appropriate checks
and balances in the system, child care funding could be
jeopardized.
Recommended amendments: If the author's intent is to, as was
stated, update an old system for the generation and storage of
child care records, the provisions of this bill should be
consistently applied across the local child care agency spectrum
and should fully comply with federal and state statute.
Committee staff recommends the bill be amended to do the
following:
1)Align language in Section 8227.3 of the Education Code
relating to APPs with Section 8262.1 related to contractors;
2)Delete language that exempts the maintenance of electronic
records from having to comply with any other laws, including
the UETA;
3)Ensure that the option to maintain records electronically is
in compliance with state and federal requirements, as
determined by CDE;
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4)Ensure that the option to use an electronic signature is in
compliance with state and federal law, as determined by CDE;
and
5)Delete language specific to electronic records storage
modalities that could conflict with state and federal law.
PRIOR LEGISLATION:
AB 2101 (Levine), 2014, was nearly identical to this bill, as
introduced. It died on the Assembly Appropriations Committee
Suspense File.
REGISTERED SUPPORT / OPPOSITION:
Support
California Alternative Payment Program Association (CAPPA),
sponsor
CAPPA Children's Foundation
Child Care Links
Child Development Associates, Inc.
Child Development Resources of Ventura County, Inc.
Community Action Partnership of San Luis Obispo
Community Child Care Council (4C's) of Alameda County
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Community Resources for Children
Controltec, Inc.
Davis Street Family Resource Center
Family Resource & Referral Center
Knowledge Universe
Mexican American Opportunity Foundation
North Coast Opportunities, Inc.
Santa Cruz County Parents Association
Sierra Nevada Children's Services
Supportive Services, Inc.
Valley Oak Children's Services
Opposition
None on file.
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Analysis Prepared
by: Myesha Jackson/HUM. S./(916) 319-2089