BILL ANALYSIS Ó
AB 2368
Page 1
ASSEMBLY THIRD READING
AB
2368 (Gordon)
As Amended April 5, 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 | |
| | | | |
| | | | |
AB 2368
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SUMMARY: Establishes a subsidized child care pilot program in
Santa Clara 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 Santa Clara 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 goals for its
subsidized child care system, as specified;
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.
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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 Santa Clara County Board of Supervisors to hold
at least one public hearing on the plan. Requires the plan,
should the board vote in favor of it after this hearing, 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 deny any modification of the plan within
30 days of receiving it. Further specifies that the Early
Education and Support Division may only deny those portions of
the plan that are not in conformance with the provisions of
this bill or that are in conflict with federal 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 2015-16 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.
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7)Repeals the provisions of this bill as of January 1, 2022.
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 Santa Clara County, as specified.
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)States the intent of the Legislature that all families have
access to child care and development services, through
resource and referral where appropriate, and regardless of
demographic background or special needs, and that families are
provided the opportunity to attain financial stability through
employment, while maximizing growth and development of their
children, and enhancing their parenting skills through
participation in child care and development programs. (EDC
8202)
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
organizations that contract with CDE. (EDC 8220)
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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)Establishes the San Mateo County, San Francisco, and Alameda
County individualized county child care subsidy plan pilot
projects. (EDC 8347, 8335, and 8340)
FISCAL EFFECT: According to the Assembly Appropriations
Committee, this bill may result in the following:
1)Allow Santa Clara County to retain unspent child care funds
that otherwise would revert to the General Fund (GF).
According to Santa Clara County's Local Early Education
Planning Council, approximately $9.3 million under the Title 5
state subsidized child care contracts has been returned to the
state. This roughly translates to 1,100 children who could
have been served in the county. 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.
2)Minor and absorbable costs to the State Department of
Education to review and approve contract amendments and other
related activities.
COMMENTS:
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
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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"; 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 APP 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.
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,
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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).
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 in Santa Clara County: 12,692 children are served by
subsidized child care programs in Santa Clara County. Santa
Clara County does not have a centralized eligibility list that
provides an exact number of children wait-listed for subsidized
child care. However, anecdotal data from providers indicates
that it is not uncommon to have waitlists of over 100 children,
and average wait times of 6 months or more.
Other county 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,
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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
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. Alameda County recently adopted its own individualized
county child care subsidy plan pilot project last year, with the
passage of AB 833 (Bonta), Chapter 563, Statutes of 2015.
Need for this legislation: According to the author:
Santa Clara County serves approximately 12,600 children in
state subsidized child care programs. Unfortunately, the
fiscal reality of living in a high-cost county means that
many families are deemed ineligible for subsidized child
care and that provider reimbursement rates are insufficient
to cover the cost, as a result, child care subsidy funds
allocated to Santa Clara County are not fully utilized or
expended. In fact, according to Santa Clara County's Local
Early Education Planning Council, approximately $9.3 million
under the Title 5 state subsidized child care contracts has
been returned to the state. This roughly translates to
1,100 children who could have been served in the county.
Like similar pilot projects before, [this bill] would give
Santa Clara County limited local flexibility to maximize
allocated funding and efficiently use child care subsidy
funds in order to meet local conditions. [This bill] would
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allow child care providers to better meet the needs of
children and working families, improve access to state
subsidized child care programs, and strengthen the fragile
child care and development infrastructure without requiring
additional state funding.
Analysis Prepared by:
Daphne Hunt / HUM. S. / (916) 319-2089 FN:
0003239