BILL ANALYSIS                                                                                                                                                                                                    Ķ



          SENATE COMMITTEE ON APPROPRIATIONS
                             Senator Ricardo Lara, Chair
                            2015 - 2016  Regular  Session

          AB 427 (Weber) - Early primary programs: child care services:  
          eligibility: military families.
          
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          |Version: May 6, 2015            |Policy Vote: ED. 9 - 0          |
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          |Urgency: No                     |Mandate: No                     |
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          |Hearing Date: July 6, 2015      |Consultant: Jillian Kissee      |
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          This bill meets the criteria for referral to the Suspense File.


          Bill  
          Summary:  This bill excludes the military housing allowance from  
          being calculated as income when determining eligibility for  
          child care and development services specified under the Child  
          Care and Development Services Act.


          Fiscal  
          Impact:  
           Unknown, potentially significant, costs and/or cost pressures  
            to the state to provide funding for services to the extent  
            additional families become eligible by meeting the income  
            eligibility requirement from disregarding the military housing  
            allowance.  Increased eligibility would result in General Fund  
            cost increases in the CalWORKs child care program, as it is an  
            entitlement, and increased cost pressures resulting from  
            longer waitlists in the appropriation-capped programs.  See  
            staff comments.  
           Minor and absorbable costs to the State Department of  







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            Education to amend regulations and to train staff on new  
            requirements.


          Background:  Existing law establishes the Child Care and Development  
          Services Act to provide child care and development services as  
          part of a coordinated, comprehensive, and cost-effective system  
          serving children from birth to 13 years old and their parents  
          including a full range of supervision, health, and support  
          services through full- and part-time programs.  (Education Code  
          § 8200 et seq.)

          The state pays for services through vouchers and contracts.   
          Child care provided through CalWORKs and the Alternative Payment  
          Program is reimbursed through vouchers.  Care provided through  
          General Child Care, Migrant and Handicapped child care, and  
          State Preschool is reimbursed through contracts with the State  
          Department of Education.

          Existing law defines "child care and development services" to  
          mean services designed to meet a wide variety of children's and  
          families' needs while parents and guardians are working, in  
          training, seeking employment, incapacitated, or in need of  
          respite.  (EC § 8208)

          Existing federal law provides a basic allowance for housing to  
          which a uniformed service member, including a member with  
          dependents, as specified, is entitled if he or she is also  
          entitled to basic pay.  (37 U.S.C. § 403)  Basic pay is received  
          by all in the military and is the main component of an  
          individual's salary.
           
          Child Care Eligibility  
          Existing law specifies that children are eligible for subsidized  
          child care if the family currently receives aid, meets specified  
          income eligibility requirements, is homeless, or if the child is  
          the recipient of protective services, or has been identified as  
          neglected, abused or exploited (or at risk of such).  In  
          addition, the family must be in need of the child care services  
          due to specified social service circumstances, employment  
          training, or other specified needs.  Families are required to  
          report changes in these circumstances throughout their child's  
          enrollment that could disqualify a child from the program.  









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          State regulations provide that for state preschool programs  
          located on or in close proximity to a military base, the  
          contractor may, with the approval of the State Department of  
          Education, exclude the basic allowance for housing for purposes  
          of determining eligibility for families with military personnel,  
          as specified, if the families reside on a military base or in  
          military housing.


          Proposed Law:  
            For purposes of determining eligibility for child care and  
          development services, this bill excludes the amount of the basic  
          allowance for housing provided to the individual that is equal  
          to the lowest rate of the allowance for the military housing  
          area in which the individual resides from the income of an  
          individual who is on federal active duty, state duty, active  
          duty for special work, or Active Guard and Reserve duty in the  
          military.  This bill also specifies that it does not affect the  
          priorities for federal and state subsidized child development  
          services that exist pursuant to existing law.


          Related  
          Legislation:  AB 170 (Saldaņa, 2007) similar to this bill,  
          excluded the basic housing allowance received by active military  
          personnel from the income calculation for purposes of  
          determining eligibility for state preschool.  AB 170 died in the  
          Assembly Appropriations committee.
          Staff Comments: This bill requires that the basic allowance for  
          housing provided to individuals in the military, as specified,  
          be excluded from the income calculation for purposes of  
          determining eligibility for child care and development services.

          The basic housing allowance depends on the individual's  
          geographic duty location, pay grade, and dependency status.   
          According to the Department of Defense, rates for Los Angeles  
          range from about $2,200 per month for lower pay grades and  
          $3,600 per month for higher pay grades, assuming the individual  
          has dependents.  This bill requires that the deducted amount be  
          equal to the lowest rate of the allowance for the military  
          housing area in which the individual resides.  This bill could  
          require exclusion of about $26,000 from a family's income using  
          Los Angeles as an example.









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          This bill will likely have the effect of prioritizing military  
          families for slots in child care programs as they become  
          available.  Since their income will be lower without the  
          inclusion of the basic housing allowance, they will move higher  
          on the waitlist for services, while other families will move  
          down.  


          To the extent this bill results in increased eligibility for  
          services for those families that are marginally above the income  
          eligibility requirement, waitlists for services may grow for  
          capped programs and General Fund costs could be triggered for  
          the CalWORKs program.  Funding in the 2015-16 fiscal year for  
          the child care and development services administered by the  
          State Department of Education that would be affected by this  
          bill, is about $2.4 billion.  Assuming most families that would  
          be affected by this bill are already receiving prioritization in  
          the state's preschool program, as authorized by regulations, the  
          scope of programs that could be affected by this bill amount to  
          about $1.4 billion.  A one percent increase in these programs to  
          serve additional children would amount to about $14 million.  

          The Budget Act of 2015 provides an increase of $52.6 million  
          General Fund to provide child care vouchers for an additional  
          6,800 children from low-income working families.  This would  
          equate to about $7,700 per slot. 




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