BILL ANALYSIS Ó AB 833 Page 1 Date of Hearing: May 13, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair AB 833 (Bonta) - As Amended April 22, 2015 ----------------------------------------------------------------- |Policy |Human Services |Vote:|7 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill establishes a 5-year subsidized child care pilot program in Alameda County. Specifically, this bill: 1)Permits Alameda County to develop and implement an individualized county child care subsidy plan, as specified. 2)Requires the California Department of Education's (CDE) Child AB 833 Page 2 Development Division (CDD) to review and either approve or disapprove any modification of the plan within 30 days of receiving it. Specifies that CDD may only disapprove those portions of the plan that are not in conformance with the provisions of this bill or that are in conflict with federal law. 3)Requires the county to prepare and submit a report summarizing the success of the county's plan, as specified, to the Legislature, the Department of Social Services (DSS), and CDE each year. 4)Requires a participating contractor to receive any increase or decrease in funding that the contractor would have received had the contractor not participated in the plan. FISCAL EFFECT: This bill would allow Alameda County to retain unspent child care funds that otherwise would revert to the General Fund. Between 2011-12 and 2013-14, the County was unable to spend approximately 5% of its contracted amounts each year, and returned over $10 million in unspent child care funding to the State. That funding is a combination of GF, Prop 98 funding and federal funds. Historically, such reversions have been redistributed for child care purposes in subsequent budget years. COMMENTS: 1)Purpose. According to the author, "In Alameda County, many children and families are unable to access quality child care in part by the unintended consequences of living in a high cost county. Since many families are deemed ineligible due to the high cost of living and provider reimbursement rates are AB 833 Page 3 insufficient to cover the cost of care, child care subsidy funds allocated to Alameda County are not fully expended. [This bill] provides Alameda County limited local flexibility with increased state oversight to address the fiscal reality of high-cost counties, where the cost of living and doing business is well beyond the state median." This bill would enable Alameda County to maximize allocated funding and efficiently use child care subsidy funds by creating an individualized county child care subsidy plan in Alameda County like those used in San Mateo and San Francisco Counties. 2)Background: California offers subsidized child care to parents participating in CalWORKs and to families transitioning off of and no longer receiving aid. This child care is offered in three "stages." DSS administers Stage 1, and CDE administers Stages 2 and 3. CDE also administers non-CalWORKs child care. The largest programs are: General Child Care, which includes contracted centers and family child care homes; the California State Preschool Program for three- and four-year olds; and APPs, which provide vouchers to obtain child care in a center, family child care home, or from a license-exempt provider. Waitlists for non-CalWORKs child care are common. Families are typically eligible for subsidized child care if their income is less than 70% of the 2007-08 State Median Income (about $42,000 per year for a family of 3), if the parents have a need related to work, training, or education, and if the children are up to 12 years old (or 21 years old for youth with exceptional needs). In Alameda County, 14,206 children are served by subsidized child care programs, not including those in CalWORKs Stage 1 child care. Alameda County does not have a centralized eligibility list that provides an exact number of children wait-listed for subsidized child care, but the Alameda County Early Care and Education Planning Council polled providers in AB 833 Page 4 the county and found that there are over 9,750 children on their waitlists. 3)Pilot Programs. The individualize county child care pilot programs in San Mateo and San Francisco Counties were created to address issues similar to those faced by Alameda County today. Both counties were seeing a portion of their child care subsidy funds go unused as low-income families in these high-cost counties failed to qualify under statewide criteria, and provider reimbursement rates were insufficient to cover program costs and overhead. These pilot projects, still in use today, offer limited local flexibility to revise eligibility rules and adjust provider rates to meet local needs. As a result, these counties have been able to reinvest otherwise-unused funds back into their programs. 4)Prior Legislation: a) AB 260 (Gordon), Chapter 731, Statutes of 2013, extended the sunset dates of the San Francisco and San Mateo County individualized county child care subsidy plans to 2016 and 2018, respectively. b) The sunset date of the San Francisco plan has been extended three times as follows: AB 86 (Committee on Budget), Chapter 48, Statutes of 2013, SB 1016 (Committee on Budget and Fiscal Review), Chapter 38, Statutes of 2012, AB 1610 (Committee on Budget), Chapter 724, Statutes of 2010, c) SB 1225 (Yee), 2010, would have extended the sunset date of the San Francisco individualized county child care subsidy plan to 2016. It was held in the Senate Appropriations Committee. AB 833 Page 5 d) AB 1304 (Simitian), Chapter 61, Statutes of 2008, extended the sunset data of the San Mateo County individualized county child care subsidy plan to 2014. e) SB 701 (Migden), Chapter 725, Statutes of 2005, established the San Francisco individualized county child care subsidy plan pilot project, to sunset in 2011. f) AB 1326 (Simitian), Chapter 691, Statutes of 2003, established the San Mateo County individualized county child care subsidy plan pilot project, to sunset in 2009. Analysis Prepared by:Jennifer Swenson / APPR. / (916) 319-2081