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Summary: |
AB 60 requires that a family, upon establishing initial eligibility for services under the Child Care and Development Services Act, to be considered to meet eligibility requirements for those services for not less than a certain number of months. Prohibits a payment made by a child development program, during a specified period, from being considered an error or an improper payment due to a change in the family's circumstances during that period. |
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Disposition: |
Pending |
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Location: |
Assembly Appropriations Committee |
Bill text can be found at: http://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180AB60
2017 CA A 60: Bill Analysis - 03/03/2017 - Assembly Human Services Committee, Hearing Date 03/07/2017
Date of Hearing: March 7, 2017
ASSEMBLY COMMITTEE ON HUMAN SERVICES
Blanca Rubio, Chair
AB 60 (Santiago/Gonzalez Fletcher) - As Introduced Ver:December 7, 2016
SUBJECT: Subsidized child care and development services: eligibility periods
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, as specified, 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, at which point a family must report increases in income that exceed this threshold and their ongoing eligibility for services would be redetermined.
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 on the basis of seeking employment to receive services for six additional months unless the family becomes otherwise eligible, as specified.
3) 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.
4) Prohibits a payment made by a child development program for a child during an eligible family's period of continuous eligibility from being considered an error or an improper payment due to the family's circumstances during that period, as specified, but permits the state or its designated agent to seek to recover payments that are the result of fraud.
5) Permits the California Department of Education (CDE) to implement certain provisions of this bill related to continuous eligibility through management bulletins or similar letters of instruction until regulations are filed with the Secretary of State and further, requires CDE to convene a workgroup of specified stakeholders to develop recommendations for implementing continuous eligibility prior to initiating a rulemaking action by December 31, 2018, as specified.
6) 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.
7) 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 data published by the United States Census Bureau for a family of the same size.
8) 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.
9) Makes technical amendments, including removing provisions that specify or refer to eligibility determination thresholds and 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. (EDC 8200 et seq.)
2) Defines "child care and development services" to mean services designed to meet a wide variety of children's and families' needs while parents and guardians are working, in training, seeking employment, incapacitated, or in need of respite. (EDC 8208)
3) 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)
4) 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)
5) 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)
6) 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.)
7) Requires the Superintendent of Public Instruction to adopt rules and regulations regarding eligibility, enrollment, and priority of services. (EDC 8263)
8) Requires the Superintendent to adopt rules, regulations, and guidelines to facilitate funding and reimbursement procedures for subsidized child care. (EDC 8269)
9) 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: Unknown.
COMMENTS:
Subsidized child care: California's subsidized child care system is designed to provide assistance to parents and guardians who are working, in training, seeking employment, incapacitated, or in need of respite. This child care is available through a number of programs; additionally, California offers State Preschool Programs to eligible three-and four-year-olds.
Parents participating in CalWORKs, as well as families transitioning off of and no longer receiving CalWORKs aid, can be eligible for child care, which 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 provides developmentally, culturally, and linguistically appropriate curriculum to eligible 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 SRR for general child care programs adopted in the Budget Act of 2016 (SB 826 [Leno], Chapter 23, Statutes of 2016) was $42.12 per child per full day of care, effective January 1, 2017; however, due to challenges with implementing two rates in the same contract year, CDE adopted a policy to average the approved rate ($38.29) and the adjusted rate ($42.12) into a blended rate ($40.20), until July 1, 2017, when the adjusted rate of $42.12 will be utilized for the entire year. Additionally, 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 currently required to use the most recent survey to set rates. Reimbursement rates for licensed providers accepting vouchers are currently derived by selecting the higher of the following: 1) the 75th percentile of the 2014 RMR survey, or 2) the RMR ceilings as they existed prior to 2017. (As of July 1, 2018, the RMR for licensed providers will be set at the 75th percentile of the 2014 RMR survey.) License-exempt providers are reimbursed at 70% of the Family Child Care Home ceilings. In Los Angeles County, for example, the full-time daily RMR for a preschool-age child in a child care center is $64.21. For that same child in a family child care home, the RMR is $50.44, and with a license-exempt provider, the RMR is $35.31.
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). The following table shows current income ceilings by family size:
Family Size Family Monthly Income Family Yearly Income
1-2 $3,283 $39,396
3 $3,518 $42,216
4 $3,908 $46,896
5 $4,534 $54,408
6 $5,159 $61,908
7 $5,276 $63,312
8 $5,394 $64,728
9 $5,511 $66,132
10 $5,628 $67,536
11 $5,745 $68,940
12 $5,863 $70,356
(Source: California Department of Education)
The Superintendent of Public Instruction is required to establish a fee schedule whereby 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 190,000 slots (not including State Preschool). State Preschool contains over 163,000 additional slots.
Minimum wage increases: SB 3 (Leno), Chapter 4, Statutes of 2016, among other things, adopted increases to the state minimum wage. These increases are to take place in specific increments over a period of six years and then according to an adjustment factor each year afterwards, with the increases beginning January 1, 2017, for employers with 26 or more employees and beginning January 1, 2018, for employers with 25 or fewer employees, as detailed in the table below:
Employers with 26 or Employers with 25 or
more employees fewer employees
Minimum wage beginning $10.50/hour (stays at $10/hour, or January 1, 2017 ($21,840/year) $20,800/year) Minimum wage beginning $11/hour ($22,880/year) $10.50/hour January 1, 2018 ($21,840/year) Minimum wage beginning $12/hour ($24,960/year) $11/hour ($22,880/year) January 1, 2019
Minimum wage beginning $13/hour ($27,040/year) $12/hour ($24,960/year)
January 1, 2020
Minimum wage beginning $14/hour ($29,120/year) $13/hour ($27,040/year)
January 1, 2021
Minimum wage beginning $15/hour ($31,200/year) $14/hour ($29,120/year)
January 1, 2022
Minimum wage beginning ($15/hour, plus an $15/hour ($31,200/year)
January 1, 2023 annual adjustment)
Need for this bill: Many working families face a conundrum when it comes to child care: it is essential to parents being able to work outside of the home, yet child care can be costly - in essence, reducing wages earned. For low-income workers, this dilemma can be stark. Consider a family where both parents work full-time, year-round and earn the minimum wage of $10.50 per hour, bringing in a total pre-tax household income of $43,860 per year. If this family had one preschool-age child placed in a family child care home at the 2014 (the most data recent available) average cost in California for this type of care ($7,850 per year), the family would be paying 18% of their pre-tax income on care. If this family had an infant placed in a child care center at average 2014 rates? They would be paying $13,327 per year - 30% of their pre-tax income. Yet this family, with an annual income of $43,860, would not qualify for subsidized child care because they earned too much to be eligible per current law.
According to the author:
"Currently, burdensome child care reporting rules in California 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.
The increase in state minimum wage is a great achievement for California, but it's still not enough to afford child care, the very thing that enables families to work. [This bill] ensures that children can stay in the child care they love for as long as their families need it and keeps them working. This measure will help eligible families achieve stability by eliminating punitive interim reporting requirements that keep eligible families from losing their child care. It also defrosts the income guidelines that have been frozen for over a decade and creates a pathway out of poverty for families. With continuous child care, children will learn in a healthy, stable environment, and develop the skills they need for Kindergarten. Moreover, stable child care helps child care providers plan for quality improvements to their programs and allows them to keep serving families."
PRIOR LEGISLATION:
AB 2150 (Santiago), 2016, was substantially similar to this bill. It died in the Senate Appropriations Committee.
SB 3 (Leno), Chapter 4, Statutes of 2016, among other things, adopted increases to the state minimum wage.
REGISTERED SUPPORT / OPPOSITION:
Support
24 Hour Oakland Parent Teacher Children Center
4C's of Alameda County
4C's of San Mateo County
9to5, National Association of Working Women
A Stronger California Advocates Network
Advancement Project
Alameda County Early Care and Education Planning Council
Alum Rock Counseling Center (ARCC)
American Academy of Pediatrics
BANANAS
Bay Area Hispano Institute for Advancement, Inc.
California Alternative Payment Program Association (CAPPA)
California Child Care Coordinators Association
California Child Care Resource and Referral Network
California Child Development Administrators (CCDAA)
California Department of Education
California Family Child Care Network
California Head Start Association
California Women's Law Center
Center for Law and Social Policy (CLASP)
Central Valley Children's Services Networks
Child Action, Inc.
Child Care Alliance of Los Angeles
Child Care Law Center (Co-sponsor)
Child Care Links
Child Care Planning Council of San Luis Obispo County
Child Development Associates, Inc.
Child Development Center and Continuing Development
Children Now
Children's Council of San Francisco
Choices for Children
Coalition of California Welfare Rights Organizations, Inc. (Co-sponsor)
Commerce San Jose
Common Sense Kids Action
Community Action Partnership of San Luis Obispo
Community Child Care Council of Alameda County
Community Child Care Council of Sonoma County
Congregation Beth Am
Crystal Stairs, Inc.
Del Norte Child Care Council
EarlyEdge California
Educare California at Silicon Valley
Educational Enrichment Systems, Inc.
Equal Rights Advocates
First 5 Association of California
First 5 California (Co-sponsor)
First 5 Monterey County
First 5 Sacramento
First 5 San Mateo County
First 5 Santa Clara County
Honorable Tom Torlakson, State Superintendent of Education
Institute for Human and Social Development (IHSD)
Kidango
KinderCare Education
LAUP
Los Angeles Area Chamber of Commerce
Los Angeles Unified School District
Marin Child Care Council
Marin Family Child Care Association
MomsRising
National Association of Social Workers, CA Chapter
National Council of Jewish Women California (NCJW CA)
Northern California Child Development, Inc.
Parent Voices CA (Co-sponsor)
Parent Voices Oakland (CPAC)
San Francisco Board of Supervisors (Katy Tang, Supervisor)
San Luis Obispo Co. Child Care Planning Council
San Mateo County Child Care Partnership Council
San Mateo County Office of Education
Santa Clara Co. Office of Education
SEIU California
Services Employees International Union (SEIU)
Shasta Head Start Child Development, Inc.
Sierra Nevada Children's Services
Silicon Valley Organization (The SVO)
Siskiyou Child Care Council
The Resource Connection of Amador and Calaveras Counties, Inc.
Toddle Flexible Preschool
UDW/AFSCME Local 3930
United Way of San Diego County
Voices for Progress
Western Center on Law and Poverty
Wu Yee Children's Services
Yolo County Office of Education
2 Individuals
Opposition
None on file.
Analysis Prepared by: Daphne Hunt / HUM. S. / (916) 319-2089 |