Bill Text: CA SB380 | 2023-2024 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: California state preschool programs: age of eligibility.

Spectrum: Partisan Bill (Democrat 3-0)

Status: (Engrossed) 2024-08-07 - August 7 hearing postponed by committee. [SB380 Detail]

Download: California-2023-SB380-Amended.html

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Amended  IN  Assembly  June 26, 2023

Amended  IN  Senate  April 18, 2023

Amended  IN  Senate  March 20, 2023

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Senate Bill

No. 380

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Introduced by Senator Limón
(Principal coauthor: Assembly Member Reyes)
(Coauthor: Assembly Member Aguiar-Curry)

February 09, 2023

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An act to amend Sections 8245.5 and 8252 of, and to amend, repeal, and add Section 8242 of, the Education Code, and to amend Sections 10227.5 and 10290 of, and to amend, repeal, and add Section 10280 of, the Welfare and Institutions Code, relating to early learning and care.

LEGISLATIVE COUNSEL'S DIGEST

SB 380, as amended, Limón. Early learning and care: rate reform.

(1) Existing law, the Early Education Act, among other things, requires the Superintendent of Public Instruction to administer all California state preschool programs, including, but not limited to, part-day and full-day age and developmentally appropriate programs for 3- and 4-year-old children. Existing law, the Child Care and Development Services Act, administered by the State Department of Social Services, establishes a system of child care and development services for children up to 13 years of age. Existing law requires the department, in collaboration with the State Department of Education, to implement a reimbursement system plan that establishes reasonable standards and assigned reimbursement rates, as specified. Existing law requires the state and Child Care Providers United - California to establish a Joint Labor Management Committee to develop recommendations for a single reimbursement rate structure that has specified characteristics, and requires the Joint Labor Management Committee to present those recommendations to the Department of Finance no later than November 15, 2022. Existing law also requires the department, in consultation with the State Department of Education, to convene a working group to assess the existing quality standards for childcare and development and preschool programs and the methodology for establishing reimbursement rates for those programs, and requires the working group to provide recommendations relating to specified topics to a specified Joint Labor Management Committee, the Department of Finance, and the Joint Legislative Budget Committee no later than August 15, 2022.

This bill would require the State Department of Social Services, in collaboration with the State Department of Education, to develop an alternative methodology for calculating subsidy payment rates for child care and development services and California state preschool program services that build upon and align with the recommendations of the working group and Joint Labor Management Committee, and that uses a cost estimation model, as specified. The bill would require the department to develop an interim transition plan, if necessary, to implement the alternative methodology, and to seek preapproval from the United States Department of Health and Human Services to amend the state’s current Child Care and Development Fund State Plan to change its current methodology for determining childcare and development and preschool subsidy payment rates to the alternative methodology. The bill would require the State Department of Social Services and the State Department of Education to implement the alternative methodology upon notice by the State Department of Social Services to the Legislature that it has adopted the alternative methodology. notice, in writing, by the State Department of Social Services to the Legislature that it has adopted the alternative methodology, as specified.

(2) Existing law requires the State Department of Social Services, in consultation with the State Department of Education, to establish a fee schedule for families using preschool and child care and development services and requires families who utilize those services to be assessed a family fee that is based on income, certified family need for full-time or part-time care services, and enrollment. Existing law prohibits those family fees from exceeding 10% of the family’s monthly income and prohibits family fees from being collected for the 2022–23 fiscal year.

The bill would require the State Department of Social Services, in consultation with the State Department of Education, to develop an equitable sliding scale for the payment of family fees, and would suspend the collection of family fees until the new equitable sliding scale is implemented.

(3) The Early Education Act requires the Superintendent of Public Instruction to adopt rules, regulations, and guidelines to facilitate the funding and reimbursement required by the act. Existing law requires, for the 2022–23 fiscal year only, contracting agencies operating a California state preschool to be reimbursed 100% of the contract maximum reimbursable amount or net reimbursable program costs, whichever is less, if they meet specified criteria.

This bill would delete the requirement that the above-described reimbursement rate apply only during the 2022–23 fiscal year, thereby extending that reimbursement rate for contracting agencies operating a California state preschool indefinitely. The bill would also delete the requirement of meeting specified criteria in order to obtain that reimbursement rate.

Existing law requires reimbursement for full-day and part-day California state preschool family childcare home education network providers for the 2022–23 fiscal year to be based on the maximum certified hours of care for all families, including families certified for a variable schedule, regardless of attendance.

This bill would delete the requirement that the above-described reimbursement provision apply during the 2022–23 fiscal year, thereby extending that reimbursement provision for full-day and part-day California state preschool family childcare home education network providers indefinitely.

(4) Existing law requires the State Department of Social Services to contract with local contracting agencies for alternative payment programs for childcare services to be provided throughout the state. Existing law requires the alternative payment program to reimburse childcare providers based upon specified criteria, including the actual days and hours of attendance for those families with variable schedules. Existing law also requires the department to administer general childcare and development programs, as specified.

This bill would instead require the alternative payment program to reimburse childcare providers based on the maximum certified hours of care, as specified. The bill would require contracting agencies operating those general childcare and development programs to be reimbursed the lesser of 100% of the contract maximum reimbursable amount or net reimbursable program costs.

Digest Key

Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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Bill Text

The people of the State of California do enact as follows:

SECTION 1.

 The Legislature finds and declares all of the following:

(a) The Legislature, through the passage of Assembly Bill 131 in 2021, required the State Department of Social Services, in consultation with the State Department of Education, to convene and create the Rate and Quality Workgroup to assess the methodology for establishing subsidy payment rates for childcare and development and preschool programs and to make related recommendations.

(b) The workgroup submitted two reports to the Legislature recommending that the state create a single subsidy payment rate structure that addresses quality standards for equity and accessibility while supporting positive learning and developmental outcomes for children.

(c) It is the intent of the Legislature that this act implements the recommendations of the workgroup to create a new subsidy payment rate structure for childcare and development and preschool programs.

SEC. 2.Section 8242 of the Education Code is amended to read:

8242.

(a)The department, in collaboration with the State Department of Social Services, shall implement a reimbursement system plan that establishes reasonable standards and assigned reimbursement rates, which vary with the length of the program year and the hours of service.

(1)Parent fees shall be used to pay reasonable and necessary costs for providing additional services.

(2)The department may establish any regulations deemed advisable concerning conditions of service and hours of enrollment for children in the programs.

(b)(1)(A)Commencing July 1, 2021, the standard reimbursement rate shall be twelve thousand nine hundred sixty-eight dollars ($12,968).

(B)Commencing July 1, 2021, the standard reimbursement rate for part-day California state preschool programs shall be five thousand six hundred twenty-one dollars ($5,621).

(2)Commencing in the 2022–23 fiscal year, the standard reimbursement rates described in paragraph (1) shall be increased by the cost-of-living adjustment granted by the Legislature annually pursuant to Section 42238.15.

(c)(1)Commencing January 1, 2022, contractors who, as of December 31, 2021, received the standard reimbursement rate established in this section shall be reimbursed at the greater of the following:

(A)The 75th percentile of the 2018 regional market rate survey.

(B)The contract per-child reimbursement amount as of December 31, 2021, as increased by the cost-of-living adjustment pursuant to paragraph (2) of subdivision (b).

(2)In accordance with federal requirements for Child Care Stabilization Grants appropriated pursuant to the federal American Rescue Plan Act of 2021 (Public Law 117-2), contractors shall provide information via a one-time application or survey in advance of receiving American Rescue Plan Act funds. The department shall specify the timeline and format in which this information shall be submitted, and the information shall include, but not be limited to, all of the following:

(A)Address, including ZIP Code.

(B)Race and ethnicity.

(C)Gender.

(D)Whether the provider is open and available to provide childcare services or closed due to the COVID-19 public health emergency.

(E)What types of federal relief funds have been received from the state.

(F)Use of federal relief funds received.

(G)Documentation that the provider met certifications as required by federal law.

(3)Rate increases shall be subject to federal usage limitations and federal and state program eligibility requirements.

(d)This section shall become inoperative on the date the department notifies the Legislature that the department has adopted the alternative methodology described in subdivision (d) of Section 10280 of the Welfare and Institutions Code, as amended by the act that added this subdivision, and, as of January 1 of the following year, is repealed.

SEC. 2.

 Section 8242 of the Education Code is amended to read:

8242.

 (a) The department, in collaboration with the State Department of Social Services, shall implement a reimbursement system plan that establishes reasonable standards and assigned reimbursement rates, which vary with the length of the program year and the hours of service.

(1) Parent fees shall be used to pay reasonable and necessary costs for providing additional services.

(2) The department may establish any regulations deemed advisable concerning conditions of service and hours of enrollment for children in the programs.

(b) (1) (A) Commencing July 1, 2021, the standard reimbursement rate shall be twelve thousand nine hundred sixty-eight dollars ($12,968).

(B) Commencing July 1, 2021, the standard reimbursement rate for part-day California state preschool programs shall be five thousand six hundred twenty-one dollars ($5,621).

(2) Commencing in the 2022–23 fiscal year, the standard reimbursement rates described in paragraph (1) shall be increased by the cost-of-living adjustment granted by the Legislature annually pursuant to Section 42238.15.

(c) (1) Commencing January 1, 2022, contractors who, as of December 31, 2021, received the standard reimbursement rate established in this section shall be reimbursed at the greater of the following:

(A) The 75th percentile of the 2018 regional market rate survey.

(B) The contract per-child reimbursement amount as of December 31, 2021, as increased by the cost-of-living adjustment pursuant to paragraph (2) of subdivision (b).

(2) Commencing July 1, 2022, subject to available funding, the department may issue temporary rate increases to contractors that exceed the rates specified in paragraph (1) and the reimbursement rate supplements described in Section 51 of Chapter 571 of the Statutes of 2022.

(3) In accordance with federal requirements for Child Care Stabilization Grants appropriated pursuant to the federal American Rescue Plan Act of 2021 (Public Law 117-2), contractors shall provide information via a one-time application or survey in advance of receiving American Rescue Plan Act funds. The department shall specify the timeline and format in which this information shall be submitted, and the information shall include, but not be limited to, all of the following:

(A) Address, including ZIP Code.

(B) Race and ethnicity.

(C) Gender.

(D) Whether the provider is open and available to provide childcare services or closed due to the COVID-19 public health emergency.

(E) What types of federal relief funds have been received from the state.

(F) Use of federal relief funds received.

(G) Documentation that the provider met certifications as required by federal law.

(4) Rate increases shall be subject to federal usage limitations and federal and state program eligibility requirements.

(d) This section shall become inoperative on the date the department notifies the Legislature in writing that the department has adopted the alternative methodology described in subdivision (d) of Section 10280 of the Welfare and Institutions Code, as amended by the act that added this subdivision, and, as of January 1 of the following year, is repealed.

SEC. 3.

 Section 8242 is added to the Education Code, to read:

8242.

 (a) The department, in collaboration with the State Department of Social Services, shall implement the alternative methodology for calculating subsidy payment rates for California state preschool program services provided under this chapter.

(b) If necessary, the department, in collaboration with the State Department of Social Services, shall implement an interim transition plan to implement the alternative methodology by increasing the various rates from their current level to the alternative methodology level over time as funds are appropriated for these purposes in the annual Budget Act. Commencing in the 2027–28 fiscal year, the department shall fully implement the alternative methodology no sooner than 30 days after notification in writing to the chairperson of the Joint Legislative Budget Committee, or not sooner than whatever lesser time the chairperson of the joint committee, or their designee, determines is appropriate.

(b)

(c) This section shall become operative on the date the department notifies the Legislature in writing that the department has adopted the alternative methodology described in Section 10280 of the Welfare and Institutions Code, as added by the act that added this section.

SEC. 4.

 Section 8245.5 of the Education Code is amended to read:

8245.5.

 (a) Notwithstanding any other law, contracting agencies operating a California state preschool program shall be reimbursed

100 percent of the contract maximum reimbursable amount or net reimbursable program costs, whichever is less, pursuant to guidance released by the Superintendent.

(b) Notwithstanding any other law, reimbursement for full-day and part-day California state preschool family childcare home education network providers shall be based on the maximum certified hours of care for all families, including families certified for a variable schedule, regardless of attendance.

SEC. 5.Section 8252 of the Education Code is amended to read:

8252.

(a)The Superintendent shall use the fee schedule developed in conjunction with the State Department of Social Services for families using full-day preschool services pursuant to this chapter, including families receiving services pursuant to subdivision (a) of Section 8211.

(b)Families shall be assessed a single flat monthly fee for all state subsidized early childhood services received, including California state preschool program services and services received through childcare and development programs administered by the State Department of Social Services, pursuant to Section 10290 of the Welfare and Institutions Code.

(c)The income of a recipient of federal supplemental security income benefits pursuant to Title XVI of the federal Social Security Act (42 U.S.C. Sec. 1381 et seq.) and state supplemental program benefits pursuant to Title XVI of the federal Social Security Act (42 U.S.C. Sec. 1381 et seq.) and Chapter 3 (commencing with Section 12000) of Part 3 of Division 9 of the Welfare and Institutions Code shall not be included in total countable income for purposes of determining the amount of the family fee.

(d)Family fees shall be assessed at initial enrollment and reassessed at recertification.

(e)Family fees shall be used by contractors to pay reasonable and necessary costs for providing additional services.

(f)It is the intent of the Legislature that the new family fees shall be cost neutral to the state and generate roughly the same amount of revenue as was generated under the previous family fee schedule.

(g)Notwithstanding any other provision of this article, family fees shall not be collected for the 2021–22 fiscal year pursuant to Section 263 of the act that added this subdivision.

(h)(1)Notwithstanding any other law, family fees shall not be collected for the 2022–23 fiscal year.

(2)Contractors shall reimburse providers operating within a family childcare home education network for the full amount of the certificate or voucher without deducting family fees.

(i)Notwithstanding any other law, family fees shall not be collected until the new equitable sliding scale is established and implemented pursuant to Section 10290 of the Welfare and Institutions Code.

SEC. 5.

 Section 8252 of the Education Code is amended to read:

8252.

 (a) The Superintendent shall use the fee schedule developed in conjunction with the State Department of Social Services for families using full-day preschool services pursuant to this chapter, including families receiving services pursuant to subdivision (a) of Section 8211.

(b) Families shall be assessed a single flat monthly fee for all state subsidized early childhood services received, including California state preschool program services and services received through childcare and development programs administered by the State Department of Social Services, pursuant to Section 10290 of the Welfare and Institutions Code.

(c) The income of a recipient of federal supplemental security income benefits pursuant to Title XVI of the federal Social Security Act (42 U.S.C. Sec. 1381 et seq.) and state supplemental program benefits pursuant to Title XVI of the federal Social Security Act (42 U.S.C. Sec. 1381 et seq.) and Chapter 3 (commencing with Section 12000) of Part 3 of Division 9 of the Welfare and Institutions Code shall not be included in total countable income for purposes of determining the amount of the family fee.

(d) Family fees shall be assessed at initial enrollment and reassessed at recertification.

(e) Family fees shall be used by contractors to pay reasonable and necessary costs for providing additional services.

(f) It is the intent of the Legislature that the new family fees shall be cost neutral to the state and generate roughly the same amount of revenue as was generated under the previous family fee schedule.

(g) Notwithstanding any other provision of this article, family fees shall not be collected for the 2021–22 fiscal year pursuant to Section 263 of the act that added this subdivision.

(h) (1) Notwithstanding any other law, family fees shall not be collected for the 2022–23 fiscal year.

(2) Contractors shall reimburse providers operating within a family childcare home education network for the full amount of the certificate or voucher without deducting family fees.

(i) (1) Notwithstanding any other law, family fees shall not be collected between July 1, 2023, and September 30, 2023, inclusive.

(2) Contractors shall reimburse providers operating within a family childcare home education network for the full amount of the certificate or voucher without deducting family fees.

(j) Notwithstanding any other law, family fees shall not be collected until the new equitable sliding scale is established and implemented pursuant to Section 10290 of the Welfare and Institutions Code.

SEC. 6.

 Section 10227.5 of the Welfare and Institutions Code is amended to read:

10227.5.

 (a) Childcare providers authorized to provide services pursuant to this chapter shall submit to the alternative payment program a monthly attendance record or invoice for each child who received services that, at a minimum, documents the dates and actual times care was provided each day, including the time the child entered care and the time the child left care each day. The information shall be documented on a daily basis.

(b) The monthly attendance record or invoice shall, at a minimum, be signed by the parent or guardian of the child receiving services and the childcare provider once per month to attest that the child’s attendance is accurately reflected. The verification of attendance shall be made by signature at the end of each month of care and under penalty of perjury by both the parent or guardian of the child receiving services and the childcare provider.

(c) The monthly attendance record or invoice shall be maintained by the childcare provider in the unaltered original format in which it was created, which may be in paper form or electronic format.

(d) The alternative payment program shall accept the monthly attendance record or invoice as documentation of the hours of care provided if the attendance record or invoice includes adequate information documented on a daily basis, including, at a minimum, the dates and actual times care was provided each day, including the time the child entered care and the time the child left care each day. Reimbursement for childcare providers, including license-exempt providers, shall be based on the maximum certified hours of care, regardless of attendance, as follows:

(1) Providers shall be reimbursed based on the maximum certified hours of care.

(2) For families certified for a variable schedule, providers shall be reimbursed based on the maximum certified hours of care.

(3) For license-exempt providers that provide part-time services, providers shall be reimbursed based on the maximum certified hours of care.

(e) For purposes of reimbursement to providers through an alternative payment program, contractors shall not be required to track absences.

(f) For purposes of this section, a monthly attendance record or invoice is defined as documentation that includes, at a minimum, the name of the child receiving services, the dates and actual times care was provided each day, including the time the child entered care and the time the child left care each day, that is signed under penalty of perjury by both the parent or guardian and the childcare provider, attesting that the information provided is accurate.

(g) Contracting agencies operating a general childcare and development program pursuant to Chapter 7 (commencing with Section 10240) of this part, also known as a General Child Care Program, shall be reimbursed 100 percent of the contract maximum reimbursable amount or net reimbursable program costs, whichever is less.

SEC. 7.Section 10280 of the Welfare and Institutions Code is amended to read:

10280.

(a)The department, in collaboration with the State Department of Education, shall implement a reimbursement system plan that establishes reasonable standards and assigned reimbursement rates, which vary with the length of the program year and the hours of service.

(1)Parent fees shall be used to pay reasonable and necessary costs for providing additional services.

(2)When establishing standards and assigned reimbursement rates, the department and the State Department of Education shall confer with applicant agencies.

(3)The reimbursement system, including standards and rates, shall be submitted to the Joint Legislative Budget Committee.

(4)The department may establish any regulations deemed advisable concerning conditions of service and hours of enrollment for children in the programs.

(b)Commencing July 1, 2021, the standard reimbursement rate shall be twelve thousand eight hundred eighty-eight dollars ($12,888) and, commencing with the 2022–23 fiscal year, shall be increased by the cost-of-living adjustment granted by the Legislature annually pursuant to Section 42238.15 of the Education Code.

(c)(1)Commencing January 1, 2022, contractors who, as of December 31, 2021, received the standard reimbursement rate established in this section shall be reimbursed at the greater of the following:

(A)The 75th percentile of the 2018 regional market rate survey.

(B)The contract per-child reimbursement amount as of December 31, 2021.

(2)In accordance with federal requirements for Child Care Stabilization Grants appropriated pursuant to the federal American Rescue Plan Act of 2021 (Public Law 117-2), contractors shall provide information via a one-time application or survey in advance of receiving American Rescue Plan Act funds. The department shall specify the timeline and format in which this information shall be submitted, and information shall include, but not be limited to, all of the following:

(A)Address, including ZIP Code.

(B)Race and ethnicity.

(C)Gender.

(D)Whether the provider is open and available to provide childcare services or closed due to the COVID-19 public health emergency.

(E)What types of federal relief funds have been received from the state.

(F)Use of federal relief funds received.

(G)Documentation that the provider met certifications as required by federal law.

(3)Rate increases shall be subject to federal usage limitations and federal and state program eligibility requirements.

(d)(1)The department, in collaboration with the State Department of Education, shall develop an alternative methodology for calculating subsidy payment rates for services provided under this part and California state preschool program services administered by the State Department of Education, in accordance with both of the following:

(A)The alternative methodology shall build on the recommendations of the working group established pursuant to Section 10280.2, and shall be aligned with the recommendations of the Joint Labor Management Committee established pursuant to Section 10280.2.

(B)The alternative methodology shall use a cost estimation model that includes all of the following:

(i)Program models will meet the current statutory and regulatory requirements for each program.

(ii)Staff salaries and benefits.

(iii)Training and professional development.

(iv)Curricula and supplies.

(v)Group size and ratios.

(vi)Enrollment levels.

(vii)Facilities and other costs.

(viii)Family engagement.

(2)If necessary, the department shall develop an interim transition plan to implement the alternative methodology by increasing the various rates from their current level to the alternative methodology level over time as funds are appropriated for these purposes in the annual Budget Act. Commencing in the 2027–28 fiscal year, the department shall fully implement the alternative methodology.

(3)Any funding provided in the Budget Act of 2023 to increase reimbursement rates shall be distributed using the interim transition plan described in paragraph (2), if that plan has been developed, until the alternative methodology described in paragraph (1) is adopted.

(4)Funding and subsidy payments shall be based on enrollment of certified children with the contract rates set using the alternative methodology.

(5)The department shall review and update the alternative methodology every three years.

(6)The department shall seek preapproval from the United States Department of Health and Human Services to amend the state’s current Child Care and Development Fund State Plan to change its current methodology for determining childcare and development and preschool subsidy payment rates to an alternative methodology, as described in this section.

(e)This section shall become inoperative on the date the department notifies the Legislature that the department has adopted the alternative methodology described in subdivision (d), and, as of January 1 of the following year, is repealed.

SEC. 7.

 Section 10280 of the Welfare and Institutions Code is amended to read:

10280.

 (a) The department, in collaboration with the State Department of Education, shall implement a reimbursement system plan that establishes reasonable standards and assigned reimbursement rates, which vary with the length of the program year and the hours of service.

(1) Parent fees shall be used to pay reasonable and necessary costs for providing additional services.

(2) When establishing standards and assigned reimbursement rates, the department and the State Department of Education shall confer with applicant agencies.

(3) The reimbursement system, including standards and rates, shall be submitted to the Joint Legislative Budget Committee.

(4) The department may establish any regulations deemed advisable concerning conditions of service and hours of enrollment for children in the programs.

(b) Commencing July 1, 2021, the standard reimbursement rate shall be twelve thousand eight hundred eighty-eight dollars ($12,888) and, commencing with the 2022–23 fiscal year, shall be increased by the cost-of-living adjustment granted by the Legislature annually pursuant to Section 42238.15 of the Education Code.

(c) (1) Commencing January 1, 2022, contractors who, as of December 31, 2021, received the standard reimbursement rate established in this section shall be reimbursed at the greater of the following:

(A) The 75th percentile of the 2018 regional market rate survey.

(B) The contract per-child reimbursement amount as of December 31, 2021.

(2) (A) Commencing July 1, 2022, subject to available funding, the department may issue temporary rate increases to contractors that exceed the rates specified in paragraph (1). The department shall have discretion in determining how funding may be used to increase the rates, including, but not limited to, providing one-time lump-sum payments. The department may contract with another entity to distribute this funding to contractors.

(B) Notwithstanding any other law, contracts or grants awarded pursuant to this subparagraph shall be exempt from the personal services contracting requirements of Article 4 (commencing with Section 19130) of Chapter 5 of Part 2 of Division 5 of Title 2 of the Government Code, the Public Contract Code, and the State Contracting Manual, and shall not be subject to review or approval of the Department of General Services.

(3) In accordance with federal requirements for Child Care Stabilization Grants appropriated pursuant to the federal American Rescue Plan Act of 2021 (Public Law 117-2), contractors shall provide information via a one-time application or survey in advance of receiving American Rescue Plan Act funds. The department shall specify the timeline and format in which this information shall be submitted, and information shall include, but not be limited to, all of the following:

(A) Address, including ZIP Code.

(B) Race and ethnicity.

(C) Gender.

(D) Whether the provider is open and available to provide childcare services or closed due to the COVID-19 public health emergency.

(E) What types of federal relief funds have been received from the state.

(F) Use of federal relief funds received.

(G) Documentation that the provider met certifications as required by federal law.

(4) Rate increases shall be subject to federal usage limitations and federal and state program eligibility requirements.

(d) (1) The department, in collaboration with the State Department of Education, shall develop an alternative methodology for calculating subsidy payment rates for services provided under this part and California state preschool program services administered by the State Department of Education, in accordance with both of the following:

(A) The alternative methodology shall build on the recommendations of the working group established pursuant to Section 10280.2, and shall be aligned with the recommendations of the Joint Labor Management Committee established pursuant to Section 10280.2.

(B) The alternative methodology shall use a cost estimation model that includes all of the following:

(i) Program models will meet the current statutory and regulatory requirements for each program.

(ii) Staff salaries and benefits.

(iii) Training and professional development.

(iv) Curricula and supplies.

(v) Group size and ratios.

(vi) Enrollment levels.

(vii) Facilities and other costs.

(viii) Family engagement.

(2) If necessary, the department, in collaboration with the State Department of Education, shall develop an interim transition plan to implement the alternative methodology by increasing the various rates from their current level to the alternative methodology level over time as funds are appropriated for these purposes in the annual Budget Act. Commencing in the 2027–28 fiscal year, the department shall fully implement the alternative methodology, no sooner than 30 days after notification in writing to the chairperson of the Joint Legislative Budget Committee, or not sooner than whatever lesser time the chairperson of the joint committee, or their designee, determines is appropriate.

(3) Any funding provided in the Budget Act of 2023 to increase reimbursement rates shall be distributed using the interim transition plan described in paragraph (2), if that plan has been developed, until the alternative methodology described in paragraph (1) is adopted.

(4) Funding and subsidy payments shall be based on enrollment of certified children with the contract rates set using the alternative methodology.

(5) The department, in collaboration with the State Department of Education, shall review and update the alternative methodology every three years.

(6) The department, in collaboration with the State Department of Education, shall seek preapproval from the United States Department of Health and Human Services to amend the state’s current Child Care and Development Fund State Plan to change its current methodology for determining childcare and development and preschool subsidy payment rates to an alternative methodology, as described in this section.

(7)    The application for preapproval in paragraph (6) shall be submitted no sooner than 30 days after notification in writing to the chairperson of the Joint Legislative Budget Committee, or not sooner than whatever lesser time the chairperson of the joint committee, or their designee, determines is appropriate.

(e) This section shall become inoperative on the date the department notifies the Legislature in writing that the department has adopted the alternative methodology described in subdivision (d), and, as of January 1 of the following year, is repealed.

SEC. 8.

 Section 10280 is added to the Welfare and Institutions Code, to read:

10280.

 (a) The department, in collaboration with the State Department of Education, shall implement an alternative methodology for calculating subsidy payment rates for services provided under this part and California state preschool program services administered by the State Department of Education, in accordance with both of the following:

(1) The alternative methodology shall build on the recommendations of the working group established pursuant to Section 10280.2, and shall be aligned with the recommendations of the Joint Labor Management Committee established pursuant to Section 10280.2.

(2) The alternative methodology shall use a cost estimation model that includes all of the following:

(A) Program models will meet the current statutory and regulatory requirements for each program.

(B) Staff salaries and benefits.

(C) Training and professional development.

(D) Curricula and supplies.

(E) Group size and ratios.

(F) Enrollment levels.

(G) Facilities and other costs.

(H) Family engagement.

(b) If necessary, the department department, in collaboration with the State Department of Education, shall implement an interim transition plan to implement the alternative methodology by increasing the various rates from their current level to the alternative methodology level over time as funds are appropriated for these purposes in the annual Budget Act. Commencing in the 2027–28 fiscal year, the department shall fully implement the alternative methodology. methodology, no sooner than 30 days after notification in writing to the chairperson of the Joint Legislative Budget Committee, or not sooner than whatever lesser time the chairperson of the joint committee, or their designee, determines is appropriate.

(c) Funding and subsidy payments shall be based on enrollment of certified children with the contract rates set using the alternative methodology.

(d) The department department, in collaboration with the State Department of Education, shall review and update the alternative methodology every three years.

(e) This section shall become operative on the date the department notifies the Legislature in writing that the department has adopted the alternative methodology described in this section.

SEC. 9.Section 10290 of the Welfare and Institutions Code is amended to read:

10290.

(a)The department, in consultation with the State Department of Education, shall establish a fee schedule for families using preschool and child care and development services pursuant to this part including families receiving services pursuant to paragraph (1) of subdivision (b) of Section 10271. It is the intent of the Legislature that the new fee schedule shall be simple and easy to implement.

(b)The family fee schedule shall retain a single flat monthly fee per family. The schedule shall differentiate between fees for part-time care and full-time care.

(c)Using the most recently approved family fee schedule pursuant to subdivision (e) of Section 10436, families shall be assessed a single flat monthly fee for all state-subsidized services, including California state preschool program services administered by the State Department of Education, based on income, certified family need for full-time or part-time care services, and enrollment, and shall not be based on actual attendance. No recalculation of a family fee shall occur if attendance varies from enrollment unless a change in need for care is assessed.

(d)The department shall design the new family fee schedule based on the most recent census data available on state median family income in the past 12 months, adjusted for family size, according to the methodology provided in subdivision (c) of Section 10271.5. The revised fees shall not exceed 10 percent of the family’s monthly income. The department shall first submit the adjusted fee schedule to the Department of Finance for approval.

(e)The income of a recipient of federal supplemental security income benefits pursuant to Title XVI of the federal Social Security Act (42 U.S.C. Sec. 1381 et seq.) and state supplemental program benefits pursuant to Title XVI of the federal Social Security Act (42 U.S.C. Sec. 1381 et seq.) and Chapter 3 (commencing with Section 12000) of Part 3 shall not be included in total countable income for purposes of determining the amount of the family fee.

(f)Family fees shall be assessed at initial enrollment and reassessed at update of certification or recertification.

(g)It is the intent of the Legislature that the new family fees shall be cost neutral to the state and generate roughly the same amount of revenue as was generated under the previous family fee schedule.

(h)Notwithstanding any other provision of this chapter, family fees shall not be collected for the 2021–22 fiscal year pursuant to Section 263 of the act that added this section.

(i)Notwithstanding any other provision of this chapter, family fees shall not be collected for the 2022–23 fiscal year.

(j)During the 2022–23 fiscal year, contractors shall reimburse subsidized childcare providers for the full amount of the certificate or voucher without deducting family fees.

(k)Notwithstanding any other law, the department, in consultation with the State Department of Education, shall develop an equitable sliding scale for the payment of family fees, and family fees shall not be collected until the new equitable sliding scale is implemented.

SEC. 9.

 Section 10290 of the Welfare and Institutions Code is amended to read:

10290.

 (a) The department, in consultation with the State Department of Education, shall establish a fee schedule for families using preschool and child care childcare and development services pursuant to this part including families receiving services pursuant to paragraph (1) of subdivision (b) of Section 10271. It is the intent of the Legislature that the new fee schedule shall be simple and easy to implement.

(b) The family fee schedule shall retain a single flat monthly fee per family. The schedule shall differentiate between fees for part-time care and full-time care.

(c) Using the most recently approved family fee schedule pursuant to subdivision (e) of Section 10436, families shall be assessed a single flat monthly fee for all state-subsidized services, including California state preschool program services administered by the State Department of Education, based on income, certified family need for full-time or part-time care services, and enrollment, and shall not be based on actual attendance. No recalculation of a family fee shall occur if attendance varies from enrollment unless a change in need for care is assessed.

(d) The department shall design the new family fee schedule based on the most recent census data available on state median family income in the past 12 months, adjusted for family size, according to the methodology provided in subdivision (c) of Section 10271.5. The revised fees shall not exceed 10 percent of the family’s monthly income. The department shall first submit the adjusted fee schedule to the Department of Finance for approval.

(e) The income of a recipient of federal supplemental security income benefits pursuant to Title XVI of the federal Social Security Act (42 U.S.C. Sec. 1381 et seq.) and state supplemental program benefits pursuant to Title XVI of the federal Social Security Act (42 U.S.C. Sec. 1381 et seq.) and Chapter 3 (commencing with Section 12000) of Part 3 shall not be included in total countable income for purposes of determining the amount of the family fee.

(f) Family fees shall be assessed at initial enrollment and reassessed at update of certification or recertification.

(g) It is the intent of the Legislature that the new family fees shall be cost neutral to the state and generate roughly the same amount of revenue as was generated under the previous family fee schedule.

(h) Notwithstanding any other provision of this chapter, family fees shall not be collected for the 2021–22 fiscal year pursuant to Section 263 of the act that added this section.

(i) Notwithstanding any other provision of this chapter, family fees shall not be collected for the 2022–23 fiscal year.

(j) During the 2022–23 fiscal year, contractors shall reimburse subsidized childcare providers for the full amount of the certificate or voucher without deducting family fees.

(k) (1) Notwithstanding any other provision of this chapter, family fees shall not be collected between July 1, 2023, and September 30, 2023, inclusive.

(2) Between July 1, 2023, and September 30, 2023, inclusive, contractors shall reimburse subsidized childcare providers for the full amount of the certificate or voucher without deducting family fees.

(3) Notwithstanding any other law, federal funds that were previously appropriated in Sections 263 and 265 of Chapter 116 of the Statutes of 2021 to expand childcare access slots and provide for family fee waivers and the reimbursement for waived family fees shall be available in the 2023–24 fiscal year in an amount that is equal to the cost to extend family fee waivers between July 1, 2023, and September 30, 2023, inclusive, for all families receiving subsidized childcare services from childcare providers through programs administered by the State Department of Social Services pursuant to Chapter 3 (commencing with Section 10225), Chapter 6 (commencing with Section 10235), Chapter 7 (commencing with Section 10240), Chapter 8 (commencing with Section 10250), Chapter 9 (commencing with Section 10260), Chapter 21 (commencing with Section 10370), and Section 11461.6.

(l) Notwithstanding any other law, the department, in consultation with the State Department of Education, shall develop an equitable sliding scale for the payment of family fees, and family fees shall not be collected until the new equitable sliding scale is implemented.