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 ----------------------------------------------------------------- | | | | | | ----------------------------------------------------------------- |--------------------------------+--------------------------------| | | | |Version: April 6, 2016 |Policy Vote: ED. 9 - 0 | | | | |--------------------------------+--------------------------------| | | | |Urgency: No |Mandate: No | | | | |--------------------------------+--------------------------------| | | | |Hearing Date: June 27, 2016 |Consultant: Jillian Kissee | | | | ----------------------------------------------------------------- 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 AB 1679 (Weber) Page 1 of ? 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 AB 1679 (Weber) Page 2 of ? 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. AB 1679 (Weber) Page 3 of ? 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 AB 1679 (Weber) Page 4 of ? 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. -- END --