BILL ANALYSIS                                                                                                                                                                                                    



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          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          833 (Bonta)


          As Amended  September 4, 2015


          Majority vote


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          |ASSEMBLY:  |80-0  |(June 1, 2015) |SENATE: | 40-0 |(September 9,    |
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          Original Committee Reference:  HUM. S.




          SUMMARY:  Establishes a subsidized child care pilot program in  
          Alameda County.  Specifically, this bill:  


          1)States legislative intent to build a stable, comprehensive,  
            and adequately funded high-quality early learning and  
            educational support system.


          2)Permits Alameda County to develop and implement an  
            individualized county child care subsidy plan, as specified,  
            to include the following:


             a)   An assessment to identify the county's goal for its  
               subsidized child care system, as specified;








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             b)   Development of a local policy to eliminate state-imposed  
               regulatory barriers to the county's achievement of its  
               desired outcomes for subsidized child care, as specified;


             c)   Recognition that all funding sources utilized by direct  
               child care service contractors in the county and  
               contractors that contract with licensed providers and  
               centers are eligible to be included in the county's plan;  
               and


             d)   Establishment of measurable outcomes to evaluate the  
               success of the plan to achieve the county's child care  
               goals and to overcome any barriers identified in the  
               state's child care subsidy plan.


          1)States that the plan, and requirements regarding it, shall not  
            be construed to permit the county to change the regional  
            market rate survey results for the county.


          2)Requires the plan to be submitted to the local planning  
            council, as specified, for approval and, upon approval,  
            requires the Alameda County Board of Supervisors to hold at  
            least one public hearing on the plan.  Should the board vote  
            in favor of the plan after this hearing, requires the plan to  
            be submitted to the California Department of Education's  
            (CDE's) Early Education and Support Division to review the  
            plan and, within 30 days of receiving it, to approve or  
            disapprove it.


          3)Requires the Early Education and Support Division to review  
            and either approve or disapprove any modification of the plan  
            within 30 days of receiving it.  Further specifies that the  
            Early Education and Support Division 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  








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            law.


          4)Requires the county, by the end of the first fiscal year of  
            operation under the approved child care subsidy plan, to  
            demonstrate an increase in the aggregate days a child is  
            enrolled in child care as compared to the enrollment in the  
            final quarter of the 2014-15 Fiscal Year.


          5)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.


          6)Requires a participating contractor to receive an increase or  
            decrease in funding that the contractor would have received  
            had the contractor not participated in the plan.


          7)Repeals the provisions of this bill as of January 1, 2021.


          8)Declares legislative findings that a special law is necessary  
            and that a general law cannot be made applicable because of  
            the unique circumstances in Alameda County, as specified.


          The Senate amendments: 


          1)Clarify that all funding sources utilized by contractors that  
            contract with licensed providers and centers are eligible to  
            be included in the county's plan.


          2)Clarify that the plan, and requirements regarding it, shall  
            not be construed to permit the county to change its regional  
            market rate survey results.










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          3)Require the plan to be submitted to the local planning  
            council, as specified, for approval and, upon approval,  
            require the Alameda County Board of Supervisors to hold at  
            least one public hearing on the plan.  Should the board vote  
            in favor of the plan after this hearing, require the plan to  
            be submitted to the CDE's Early Education and Support Division  
            to review the plan and, within 30 days of receiving it, to  
            approve or disapprove it.


          4)Require the county, by the end of the first fiscal year of  
            operation under the approved child care subsidy plan, to  
            demonstrate an increase in the aggregate days a child is  
            enrolled in child care as compared to the enrollment in the  
            final quarter of the 2014-15 fiscal year.


          5)Make other technical changes.


          EXISTING LAW establishes the San Mateo County and San Francisco  
          individualized county child care subsidy plan pilot projects and  
          provides for them to sunset in 2016 and 2018, respectively.   
          (Education Code (EDC) Sections 8347 and 8335)


          FISCAL EFFECT:  According the Senate Appropriations Committee,  
          this bill may result in the following costs:  


          1)Alameda County individualized subsidy plan:  Potential loss of  
            savings in the low millions to the extent the plan allows more  
            of the county's funding allocation to be expended.


          2)CDE indicates minor and absorbable costs to review and approve  
            contract amendments and other related activities.


          










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          COMMENTS:  


          Child care in Alameda County:  As of April 2015, approximately  
          14,000 children were served by subsidized child care programs in  
          Alameda County (note that these data do not include the number  
          of children in CalWORKs Stage 1 child care).  While Alameda  
          County does not have a centralized eligibility list that  
          provides an exact number of children wait-listed for subsidized  
          child care, the Alameda County Early Care and Education Planning  
          Council polled a number of providers in the county earlier this  
          year and found that there were over 9,750 children on their  
          waitlists.  This indicates that there are likely well over  
          10,000 children in the county who are eligible for, but unable  
          to access slots in, local subsidized child care programs.  One  
          study found that, during the period of 2011-12 to 2013-14,  
          Alameda County lost 22% of its subsidized child care  
          contractors.  


          San Mateo County and San Francisco pilot programs:  AB 1326  
          (Simitian), Chapter 691, Statutes of 2003, established the San  
          Mateo County individualized county child care subsidy plan pilot  
          project and SB 701 (Migden), Chapter 725, Statutes of 2005,  
          established the San Francisco individualized county child care  
          subsidy plan pilot project.  Both pilots were developed to  
          address two significant issues facing subsidized child care in  
          high-cost counties:  1) that low-income families earning just  
          enough to afford housing in a high-cost area may be deemed to  
          earn too much to qualify for assistance with child care by  
          statewide eligibility standards, and 2) that the statewide SRR  
          paid to contracted child care centers and family child care  
          homes is often not sufficient to cover program costs and  
          overhead, particularly in high-cost areas.  Both counties would  
          see a portion of their child care subsidy funds go unused as  
          low-income families failed to qualify for eligibility by uniform  
          statewide criteria, and as provider reimbursement rates made  
          offering subsidized care untenable for some providers.


          San Mateo County's and San Francisco's pilot programs, still in  
          operation today, offer them the limited local flexibility to  








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          revise eligibility rules and adjust provider rates and family  
          fees within the context of local evaluation and assessment and  
          heightened state oversight.  Thus, the counties are able to  
          reinvest otherwise-unused funds through increased reimbursement  
          rates.  Both San Mateo County and San Francisco are also allowed  
          flexibility regarding eligibility rules.  


          Evaluation results for both counties have indicated a number of  
          successes, including increases in the number of aggregate days  
          of enrollment in subsidized child care and decreases in the  
          amount of unspent child care funds returned to the state.


          Need for this bill:  With high numbers of children waitlisted  
          for subsidized child care, and difficulties retaining  
          contractors, Alameda County may be a good candidate for an  
          individualized county child care subsidy plan like those seen in  
          San Mateo County and San Francisco.


          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 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.  With the ability to revise their eligibility and  
            need determinations, adjust their reimbursement rates and  
            family fees based upon a local evaluation and assessment,  
            and modify their funding requirements, Alameda County  
            will be able to maximize allocated funding and  








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            efficiently use child care subsidy funds to meet local  
            conditions.  As a result, more children can be served  
            with quality child care.


          Analysis Prepared by:                                             
                          Daphne Hunt / HUM. S. / (916) 319-2089  FN:  
          0002343