BILL ANALYSIS Ó
AB 2150
Page 1
ASSEMBLY THIRD READING
AB
2150 (Santiago, et al.)
As Amended June 1, 2016
Majority vote
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+---------------------|
|Human Services |7-0 |Bonilla, Grove, | |
| | |Calderon, Lopez, | |
| | |Maienschein, Mark | |
| | |Stone, Thurmond | |
| | | | |
|----------------+-----+----------------------+---------------------|
|Appropriations |20-0 |Gonzalez, Bigelow, | |
| | |Bloom, Bonilla, | |
| | |Bonta, Calderon, | |
| | |Chang, Daly, Eggman, | |
| | |Gallagher, Eduardo | |
| | |Garcia, Roger | |
| | |Hernández, Holden, | |
| | |Jones, Obernolte, | |
| | |Quirk, Santiago, | |
| | |Wagner, Weber, Wood | |
| | | | |
| | | | |
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AB 2150
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SUMMARY: Provides for changes to eligibility determination and
redetermination for subsidized child care. Specifically, this
bill:
1)Requires a family, upon establishing initial or ongoing
eligibility for subsidized child care services, to:
a) Be considered to meet all eligibility requirements for a
period of not less than 12 months, unless the family
established eligibility on the basis of seeking employment,
as specified;
b) Receive subsidized child care services for not less than
12 months prior to having their eligibility redetermined,
unless the family established eligibility on the basis of
seeking employment, as specified; and
c) Not be required to report changes to income or other
changes for at least 12 months, unless the family attains
an income that exceeds the threshold for ongoing
eligibility, as specified.
2)Requires a family that establishes initial eligibility on the
basis of seeking employment to receive services for not less
than six months and further requires a family that establishes
ongoing eligibility for subsidized child care to receive
services for six additional months unless the family becomes
otherwise eligible, as specified.
3)Requires a family to report increases in income that exceed
the threshold for ongoing income eligibility, as specified,
and further requires the family's ongoing eligibility to be
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redetermined at that time.
4)Permits a family to, at any time, voluntarily report income or
other changes for purposes of reducing a family's fees,
increasing a family's subsidy, or extending the period of the
family's eligibility prior to redetermination.
5)Stipulates that a payment made by a child development program
for a child prior to the next redetermination of eligibility
shall not be considered an error or an improper payment due to
a change in the family's circumstances during that period, as
specified.
6)Authorizes the California Department of Education (CDE) to
implement 12-month continuous eligibility, as specified, for
subsidized child care via management bulletins or similar
letters of instruction until implementing regulations are
filed with the Secretary of State and further, requires CDE to
initiate a rulemaking action to implement 12-month continuous
eligibility by December 31, 2017, and after convening a
workgroup of stakeholders to develop related recommendations,
as specified.
7)Specifies that, for purposes of establishing initial income
eligibility for subsidized child care services, "income
eligible" means that a family's adjusted monthly income is at
or below 70% of the state median income (SMI) based on the
most recent data published by the United States Census Bureau
for a family of the same size.
8)Defines, for purposes of establishing ongoing income
eligibility for subsidized child care services, "ongoing
income eligible" to mean that a family's adjusted monthly
income is at or below 85% of the SMI based on the most recent
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data published by the United States Census Bureau for a family
of the same size.
9)Authorizes any family that receives first priority for
subsidized child care services, as specified, to be exempt
from family fees for up to 12 months.
10)Makes technical amendments, including removing provisions
that specify or refer to eligibility determination periods
that conflict with the provisions contained in this bill.
EXISTING LAW:
1)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, and
including a full range of supervision, health, and support
services through full- and part-time programs. (Education
Code Section (EDC) 8200 et seq.)
2)Requires the Superintendent of Public Instruction to
administer general child care and development programs to
include, among other things as specified, age- and
developmentally-appropriate activities, supervision, parenting
education and involvement, and nutrition. Further allows such
programs to be designed to meet child-related needs identified
by parents or guardians, as specified. (EDC 8240 and 8241)
3)To allow for maximum parental choice, authorizes the operation
of Alternative Payment Programs (APPs) and provision of
alternative payments and support services to parents and child
care providers by local government agencies or non-profit
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organizations that contract with California Department of
Education (CDE). (EDC 8220)
4)Establishes rules and requirements for APPs and providers, as
contracted agencies with CDE, to observe, including but not
limited to accounting and auditing requirements, attendance
monitoring requirements, referral requirements where
applicable, and reimbursement and payment procedures. (EDC
8220 et seq.)
5)Requires the Superintendent to establish a family fee schedule
for subsidized child care, as specified, contingent on income
and subject to a cap. (EDC 8273)
FISCAL EFFECT: According to the Assembly Appropriations
Committee, this bill may result in the following costs:
1)Unknown, potentially major costs to the CDE, estimated in the
range of $1 million to $5 million annually, due to increased
caseload for CalWORKs stages 2 and 3 child care. With
existing data we are unable to identify the percentage of
children leaving child care due to loss of eligibility. This
estimate assumes between 2% and 10% of the existing number of
children leaving child care each month would instead continue
child care under this bill.
2)Administrative costs to CDE of approximately $40,000 in Fiscal
Year (FY) 2016-17 and $23,000 in FY 2017-18 to update
regulations.
COMMENTS:
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Subsidized child care: Subsidized child care may be available
to low-income families through a number of programs.
Additionally, California offers State Preschool Programs to
eligible three-and four-year-olds. 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"; Department of Social Services
(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, which includes contracted centers and family
child care homes for three- and four-year olds; and APPs, which
provide vouchers that can be used 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.
Contracted providers are funded through the receipt of the
Standard Reimbursement Rate (SRR) based on the number of
children enrolled and the hours of care provided. Families may
also be required to pay a family fee if they earn above a
certain threshold income for their family size. The current SRR
is $38.29 per child for a full day of care. Adjustment factors
are applied to the SRR in some instances to reflect the
increased cost of care for the different ages and needs of
children.
The Regional Market Rate (RMR) survey calculates the market
rates for child care in each of California's 58 counties and
uses these to establish maximum child care reimbursement rates
for child care services for families in various APPs or other
voucher child care programs. States are required to conduct a
market rate survey every two years, but are not required to use
the most recent survey to set rates. Reimbursement rates for
licensed providers accepting vouchers are currently derived by
applying a formula to the 2009 RMR. License-exempt providers
are reimbursed at 65% of the Family Child Care Home ceilings.
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In Santa Clara County, for example, the full-time daily RMR for
a preschool-age child in a child care center is $69.77. For
that same child in a family child care home, the RMR is $57.88,
and with a license-exempt provider, the RMR is $37.62.
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).
Families may be charged a "family fee" depending on their
income. For a family of 3, for example, subsidized child care
remains at no cost for families earning less than $1,950 per
month. However, with incomes between $1,950 a month and the
monthly income ceiling of $3,518, a family fee is charged, the
amount of which increases with income, but never to surpass 10%
of a family's income. For a family of three with a monthly
income of $1,950, the family fee per month for full-time care is
$42; for a family of three earning $3,518 per month, this fee is
$345.
Across the various subsidized child care programs, there are
estimated to be over 195,000 slots (not including State
Preschool). State Preschool contains over 157,000 additional
slots.
Child Care and Development Block Grant (CCDBG): The federal
Child Care and Development Block Grant Act of 2014 (P.L.
113-186) reauthorized the Child Care and Development Block Grant
Act of 1990. This reauthorization brought about a number of
changes aimed at addressing health and safety requirements,
quality of care, and consumer and provider education.
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One specific change adopted by this reauthorization establishes
a 12-month eligibility redetermination period for families,
regardless of changes in income (provided income does not exceed
85% of the SMI, the maximum income ceiling allowable under
federal law) or temporary changes in participation in work,
training, or education activities.
Also, according to the federal Administration for Children and
Families' (ACF) Office of Child Care:
The [CCDBG Act] specifies that a State must provide for a
graduated phase-out of assistance for families whose income
has increased at the time of re-determination, but still
does not exceed the federal income limit of 85% of State
Median Income (SMI). Providing a graduated phase-out
promotes continuity by allowing for wage growth, a tapered
transition out of the child care subsidy program, and
supports long-term financial stability to help families get
to a point where they no longer need the subsidy. Sudden
withdrawal of support can destabilize and undermine a
family's pathway to financial stability.
ACF strongly encourages States and Territories to consider
how to continue to support families through access to
financial assistance for child care until they have achieved
financial stability. Pending additional guidance from ACF,
this could be achieved through policies such as establishing
a second income eligibility threshold at re-determination
(e.g., establishing a different eligibility threshold for
families first applying for assistance and those already
receiving assistance, sometimes called an 'exit threshold')
or by granting a sustained period of continued assistance to
the family before termination. The law allows the exit
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threshold to be set as high as 85% of SMI. States could
adjust co-pays for families during this period to create a
gradual shift in how families must adjust their budget to
cover the full cost of care once they are no longer
receiving a subsidy, but should consider how to do this in a
way that minimizes paperwork and reporting burdens on
working families.
Need for this bill: According to the author:
In California, burdensome reporting rules cause eligible
families to churn between child care programs and long
waiting lists for the programs. Churning disrupts
children's school readiness and development; makes it
impossible for child care providers to balance ledgers or
plan for quality investments; and burdens employers and
education providers to sign off on endless paperwork.
There is broad consensus among child care administrators,
advocates, and parents that the state's current reporting
rules are harmful, and that establishing more stability
within the child care system will create better outcomes for
children.
Analysis Prepared by:
Daphne Hunt / HUM. S. / (916) 319-2089 FN:
0003389
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