BILL ANALYSIS                                                                                                                                                                                                    Ķ



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

          AB 1679 (Weber) - Child care:  state preschool programs:   
          eligibility:  military families
          
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          |Version: April 6, 2016          |Policy Vote: ED. 9 - 0          |
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          |Urgency: No                     |Mandate: No                     |
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          |Hearing Date: June 27, 2016     |Consultant: Jillian Kissee      |
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          This bill meets the criteria for referral to the Suspense File.



          Bill  
          Summary:  This bill, for purposes of determining eligibility for  
          state preschool services, excludes the amount of basic allowance  
          for housing, as specified, from the income of active duty  
          military personnel.


          Fiscal  
          Impact:  
           Unknown, potentially significant state cost pressure to  
            provide additional funding for services to the extent  
            additional families become eligible for preschool services  
            that would have otherwise not qualified, by excluding the  
            basic allowance for housing from income calculations,  
            resulting in longer waitlists.  This bill codifies existing  
            regulations providing this benefit, and expands upon them by  
            not limiting it to preschool programs on or near a military  
            base or base housing, or to families that reside on a military  







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            base or in military housing.  See staff comments.   
            (Proposition 98)


           The California Department of Education (CDE) indicates that  
            this bill creates minor costs related to issuing technical  
            assistance to the field and amending regulations which can be  
            incorporated into existing workload.  


          Background:  Existing law establishes the state preschool program for  
          purposes of providing part-day and full-day developmentally  
          appropriate programs designed to facilitate the transition to  
          kindergarten for three- and four-year-old children in  
          educational development, health services, social services,  
          nutritional services, parent education and participation,  
          evaluation, and staff development.  Existing law requires that  
          to be eligible for preschool, a family must meet at least one of  
          the following criteria: the family is a current aid recipient,  
          income eligible, homeless, or one whose children are recipients  
          of protective services, or have been identified as being abused,  
          neglected, or exploited.  (Education Code § 8235 and 8263)  
          Existing law requires that first priority go to three- or  
          four-year-old neglected or abused children who are recipients of  
          child protective services, or who are at risk of being  
          neglected, abused, or exploited upon written referral from a  
          legal, medical, or social service agency.  After this priority  
          is satisfied then the next priority is given to eligible  
          four-year-old children who are not enrolled in a state-funded  
          transitional kindergarten program before enrolling eligible  
          three-year-old children.  (Education Code § 8236)

          Existing law establishes the income eligibility limit for child  
          care and development services, including State Preschool, at 70  
          percent of the state median income that was in use for the  
          2007-08 fiscal year, adjusted for family size.  (Education Code  
          § 8263.1)  


          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)  According to the  
          Department of Defense's website, basic pay is received by all in  








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          the military and is the main component of an individual's  
          salary.  Monetary allowances are provided when the government  
          does not provide for a specific need.  The majority of military  
          personnel receive the basic allowance for housing.


          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 CDE, exclude the basic  
          allowance for housing for purposes of determining eligibility  
          and income ranking for families with military personnel, as  
          specified, if the families reside on a military base or in  
          military housing.  (Title 5, California Code of Regulations, §  
          18134)




          Proposed Law:  
            This bill, for purposes of determining eligibility for state  
          preschool services, excludes from the income of an individual  
          who is on federal active duty, state active duty, active duty  
          for special work, or Active Guard and Reserve duty in the  
          military the amount of 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.
          This bill also provides that nothing shall supersede the state  
          mandated priorities for state-subsidized child development  
          services.




          Related  
          Legislation:  AB 427 (Weber, 2015), similar to 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.  This bill (AB 1679) is limited to  
          state preschool services only.  AB 427 failed passage in this  
          committee.
          AB 170 (Saldaņa, 2007) was almost identical to this bill.  It  
          failed passage in the Assembly Appropriations Committee.









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          Staff  
          Comments:  State Preschool, among other child care programs, is  
          unable to serve all eligible children since the number of  
          subsidized slots is capped by the amount authorized in the  
          annual budget act.  Priority is given to certain children and  
          those that do not receive a slot may be put on waiting lists.
          The basic allowance for housing depends on the service member's  
          geographic duty location, pay grade, and dependency status.   
          This allowance is on top of the individual's basic pay and other  
          allowances the federal government provides.  This bill requires  
          the lowest rate of the housing allowance for the military  
          housing area in which the individual resides to be excluded from  
          income calculations.  According to the Department of Defense's  
          website, rates in California range from $4,002 per month in San  
          Francisco and $807 per month in Twenty Nine Palms for the lowest  
          pay grade, assuming the individual has dependents.  Annualized,  
          these amounts equate to $48,024 and $9,684 respectively, and  
          would be excluded from a service member's income for determining  
          State Preschool income eligibility.  The annual income cap for a  
          family of three to receive state preschool services is $42,216.   



          State Preschool is reimbursed through contracts with the CDE.   
          To date, 16 contractors covering 96 sites were approved for  
          waivers to exclude the basic allowance for housing under the  
          authority provided by regulations.  This bill codifies and  
          expands upon existing regulations as exclusion of the housing  
          allowance would not be limited to programs on or near a military  
          base or base housing, or to families that reside on a military  
          base or in military housing.  


          There are about 3,000 preschool children of Marines that meet  
          the income eligibility requirement in California.  The Marine  
          Corps is estimated to have about one-third of the preschool  
          population in the state for all services, which would be  
          extrapolated to a total of 9,000 eligible preschool children.  


          This bill will likely increase eligibility for services to  








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          families that are currently marginally above the income  
          eligibility requirement causing waitlists for services to grow.   
          The annual cost for one part-day State Preschool slot is about  
          $4,600 and $10,600 for full day, using the anticipated  
          reimbursement rate effective January 1, 2017.  If eligibility  
          increased by roughly 1 percent, funding needed for 100 more  
          slots would be about $460,000 for part-day preschool and about  
          $1 million for full-day, using Proposition 98 funds if the  
          services take place at a local educational agency.      


          This bill will also have the effect of prioritizing military  
          families for slots as they become available.  Since their income  
          will be lower without the inclusion of the basic allowance for  
          housing, they will move higher on the waitlist for services,  
          while other families will move down.  However, once on the  
          waitlist, at-risk children and eligible four-year-olds would  
          continue to have priority in the program.  Staff notes that SB  
          826, the 2016-17 budget bill, provides 2,959 additional full-day  
          state preschool slots beginning March 1, 2017.  




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