2021 -- S 0378 SUBSTITUTE A

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

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A N   A C T

RELATING TO HUMAN SERVICES -- RHODE ISLAND CHILD CARE IS ESSENTIAL

ACT

     Introduced By: Senators Cano, DiMario, Valverde, Mack, McCaffrey, Coyne, Goodwin,
Sosnowski, Quezada, and Murray

     Date Introduced: February 25, 2021

     Referred To: Senate Health & Human Services

     It is enacted by the General Assembly as follows:

     SECTION 1. Legislative findings.

     The general assembly finds that:

     (1) The COVID-19 pandemic has exacerbated the child care workforce which is almost all

women and disproportionately women of color. That workforce has also contracted COVID-19.

The child care workforce is only seventy-nine percent (79%) as large as it was in February, 2020,

before the pandemic began, according to the National Women’s Law Center.

     (2) Access to affordable, high-quality childcare is essential to support labor force

participation of parents with children from infancy through age twelve (12) and to maximize the

economic productivity of the state.

     (3) Access to affordable, high-quality child care is essential for all parents to achieve

economic security and independence, but particularly for mothers who often have lower lifetime

earnings because they earn lower wages, work reduced hours, and take longer breaks from work in

order to care for children.

     (4) Access to subsidized child care is essential in addressing racial inequity. Thirty-nine

percent (39%) of young Black children and thirty percent (30%) of young Latino children live in

poverty, while thirteen percent (13%) of young white children live in poverty.

     (5) High-quality child care programs, staffed by qualified and effective educators, are

essential for children to promote healthy development and optimize learning during the early

childhood and school-age years.

     (6) A landmark 2015 report by the Institute of Medicine and National Research Council

found that children begin learning at birth and the adults that provide for the care and education of

children bear a great responsibility for their health, development, and learning -- setting the critical

foundation for lifelong progress. The report recommends that states work to increase the

qualifications and compensation of child care educators, including those who care for infants and

toddlers.

     (7) Child care educators are among the lowest paid workers in Rhode Island. In 2019, the

median wage of a child care educator in Rhode Island was twelve dollars and one cent ($12.01) per

hour. As the state minimum wage increases, child care programs will need additional revenue to

comply with the minimum wage rules and to attract and retain qualified and effective educators.

     (8) The U.S. Department of Health and Human Services provides significant funding to

Rhode Island through the Child Care and Development Block Grant and has established clear

guidelines for setting rates that provide low-income families with "equal access" to the child care

market as required under federal law. The "equal access" guideline is to pay rates equal to or above

the seventy-fifth percentile of a recent market rate survey.

     (9) The U.S. Department of Health and Human Services has also established a clear

guideline for determining whether childcare is affordable. Currently, the federal guideline for

affordability is that families should pay no more than seven percent (7%) of family income for

childcare. Using that guideline, almost all families with young children in the state of Rhode Island

need a subsidy to afford the cost of high-quality care staffed by qualified, effective, and fairly-

compensated educators.

     SECTION 2. Section 40-5.2-20 of the General Laws in Chapter 40-5.2 entitled "The Rhode

Island Works Program" is hereby amended to read as follows:

     40-5.2-20. Childcare assistance -- Families or assistance units eligible.

     (a) The department shall provide appropriate child care to every participant who is eligible

for cash assistance and who requires child care in order to meet the work requirements in

accordance with this chapter.

     (b) Low-income child care. The department shall provide child care to all other working

families with incomes at or below one hundred eighty percent (180%) two hundred twenty-five

percent (225%) of the federal poverty level if, and to the extent, these other families require child

care in order to work at paid employment as defined in the department's rules and regulations.

Beginning October 1, 2013, the department shall also provide child care to families with incomes

below one hundred eighty percent (180%) two hundred twenty-five percent (225%) of the federal

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poverty level if, and to the extent, these families require child care to participate on a short-term

basis, as defined in the department's rules and regulations, in training, apprenticeship, internship,

on-the-job training, work experience, work immersion, or other job-readiness/job-attachment

program sponsored or funded by the human resource investment council (governor's workforce

board) or state agencies that are part of the coordinated program system pursuant to § 42-102-11.

     (c) No family/assistance unit shall be eligible for childcare assistance under this chapter if

the combined value of its liquid resources exceeds one million dollars ($1,000,000), which

corresponds to the amount permitted by the federal government under the state plan and set forth

in the administrative rulemaking process by the department. Liquid resources are defined as any

interest(s) in property in the form of cash or other financial instruments or accounts that are readily

convertible to cash or cash equivalents. These include, but are not limited to: cash, bank, credit

union, or other financial institution savings, checking, and money market accounts; certificates of

deposit or other time deposits; stocks; bonds; mutual funds; and other similar financial instruments

or accounts. These do not include educational savings accounts, plans, or programs; retirement

accounts, plans, or programs; or accounts held jointly with another adult, not including a spouse.

The department is authorized to promulgate rules and regulations to determine the ownership and

source of the funds in the joint account.

     (d) As a condition of eligibility for childcare assistance under this chapter, the parent or

caretaker relative of the family must consent to, and must cooperate with, the department in

establishing paternity, and in establishing and/or enforcing child support and medical support

orders for any children in the family receiving appropriate child care under this section in

accordance with the applicable sections of title 15 of the state's general laws, as amended, unless

the parent or caretaker relative is found to have good cause for refusing to comply with the

requirements of this subsection.

     (e) For purposes of this section, "appropriate child care" means child care, including infant,

toddler, pre-school, nursery school, and school-age, that is provided by a person or organization

qualified, approved, and authorized to provide the care by the state agency or agencies designated

to make the determinations in accordance with the provisions set forth herein.

     (f)(1) Families with incomes equal to or below one hundred percent (100%) of the

applicable federal poverty level guidelines shall be provided with free child care. Families with

incomes greater than one hundred percent (100%) and less than one hundred eighty percent (180%)

of the applicable federal poverty guideline shall be required to pay for some portion of the child

care they receive, according to a sliding-fee scale adopted by the department in the department's

rules with no family required to pay more than the federally-established guideline for affordability,

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currently seven percent (7%) of family income.

     (2) Families who are receiving childcare assistance and who become ineligible for

childcare assistance as a result of their incomes exceeding one hundred eighty percent (180%) two

hundred twenty-five percent (225%) of the applicable federal poverty guidelines shall continue to

be eligible for childcare assistance until their incomes exceed two hundred twenty-five percent

(225%) three hundred percent (300%) of the applicable federal poverty guidelines. To be eligible,

the families must continue to pay for some portion of the child care they receive, as indicated in a

sliding-fee scale adopted in the department's rules and in accordance with all other eligibility

standards.

     (g) In determining the type of child care to be provided to a family, the department shall

take into account the cost of available childcare options; the suitability of the type of care available

for the child; and the parent's preference as to the type of child care.

     (h) For purposes of this section, "income" for families receiving cash assistance under §

40-5.2-11 means gross, earned income and unearned income, subject to the income exclusions in

§§ 40-5.2-10(g)(2) and 40-5.2-10(g)(3), and income for other families shall mean gross, earned and

unearned income as determined by departmental regulations.

     (i) The caseload estimating conference established by chapter 17 of title 35 shall forecast

the expenditures for child care in accordance with the provisions of § 35-17-1.

     (j) In determining eligibility for childcare assistance for children of members of reserve

components called to active duty during a time of conflict, the department shall freeze the family

composition and the family income of the reserve component member as it was in the month prior

to the month of leaving for active duty. This shall continue until the individual is officially

discharged from active duty.

     SECTION 3. Section 40-6.2-1.1 of the General Laws in Chapter 40-6.2 entitled "Child

Care - State Subsidies" is hereby amended to read as follows:

     40-6.2-1.1. Rates established Child care established to ensure equal access and

promote quality Child care rates established to ensure equal access and promote quality.

     (a) Through June 30, 2015, subject to the payment limitations in subsection (c), the

maximum reimbursement rates to be paid by the departments of human services and children, youth

and families for licensed childcare centers and licensed family childcare providers shall be based

on the following schedule of the 75th percentile of the 2002 weekly market rates adjusted for the

average of the 75th percentile of the 2002 and the 2004 weekly market rates:

LICENSED CHILDCARE CENTERS 75th PERCENTILE OF WEEKLY

MARKET RATE

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INFANT $182.00

PRESCHOOL $150.00

SCHOOL-AGE $135.00

LICENSED FAMILY CHILDCARE 75th PERCENTILE OF WEEKLY

PROVIDERS MARKET RATE

INFANT $150.00

PRESCHOOL $150.00

SCHOOL-AGE $135.00

     Effective July 1, 2015, subject to the payment limitations in subsection (c), the maximum

reimbursement rates to be paid by the departments of human services and children, youth and

families for licensed childcare centers and licensed family childcare providers shall be based on the

above schedule of the 75th percentile of the 2002 weekly market rates adjusted for the average of

the 75th percentile of the 2002 and the 2004 weekly market rates. These rates shall be increased by

ten dollars ($10.00) per week for infant/toddler care provided by licensed family childcare

providers and license-exempt providers and then the rates for all providers for all age groups shall

be increased by three percent (3%). For the fiscal year ending June 30, 2018, licensed childcare

centers shall be reimbursed a maximum weekly rate of one hundred ninety-three dollars and sixty-

four cents ($193.64) for infant/toddler care and one hundred sixty-one dollars and seventy-one

cents ($161.71) for preschool-age children.

     (a) Effective July 1, 2021, the reimbursement rates to be paid by the departments of human

services and children, youth and families for licensed child care centers and family child care homes

shall be increased across all age groups and settings to meet or exceed the federal equal access

benchmark for child care subsidy rates, the seventy-fifth percentile of the most recent market rate

survey. Programs that have achieved the highest quality rating of five (5) stars as measured by the

state's quality rating and improvement system established pursuant to chapter 12 of title 42, shall

be paid rates at or above the ninetieth percentile of the most recent market rate survey.

Reimbursement rates for programs with ratings of two (2) stars, three (3) stars, and four (4) stars

as measured by the state's quality rating and improvement system established pursuant to chapter

12 of title 42 shall be set at incremental increased levels between the one star and five (5) star rates

to promote and sustain the higher-quality standards that support children's learning and

development.

     (b) Effective July l, 2018, subject to the payment limitations in subsection (c), the

maximum infant/toddler and preschool-age reimbursement rates to be paid by the departments of

human services and children, youth and families for licensed childcare centers shall be

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implemented in a tiered manner, reflective of the quality rating the provider has achieved within

the state's quality rating system outlined in § 42-12-23.1.

     (1) For infant/toddler child care, tier one shall be reimbursed two and one-half percent

(2.5%) above the FY 2018 weekly amount, tier two shall be reimbursed five percent (5%) above

the FY 2018 weekly amount, tier three shall be reimbursed thirteen percent (13%) above the FY

2018 weekly amount, tier four shall be reimbursed twenty percent (20%) above the FY 2018 weekly

amount, and tier five shall be reimbursed thirty-three percent (33%) above the FY 2018 weekly

amount.

     (2) For preschool reimbursement rates, tier one shall be reimbursed two and one-half

(2.5%) percent above the FY 2018 weekly amount, tier two shall be reimbursed five percent (5%)

above the FY 2018 weekly amount, tier three shall be reimbursed ten percent (10%) above the FY

2018 weekly amount, tier four shall be reimbursed thirteen percent (13%) above the FY 2018

weekly amount, and tier five shall be reimbursed twenty-one percent (21%) above the FY 2018

weekly amount.

     (b) Effective July 1, 2021, the minimum weekly rates paid by the departments of human

services and children, youth and families for licensed child care shall meet or exceed the following

benchmarks from 2018 Rhode Island Child Care Market Rate Survey.

Licensed Child Care Centers

      1 star 2 star 3 star 4 star 5 star

      75th percentile 90th percentile

Infant/Toddler $256.75 $267.26 $277.79 $288.32 $298.85

Preschool $230.00 $235.14 $240.30 $245.46 $250.62

School-Age $198.75 $202.43 $206.12 $209.81 $213.50

Licensed Family Child Care Homes

      1 star 2 star 3 star 4 star 5 star

      75th percentile 90th percentile

Infant/Toddler $200.00 $208.11 $216.24 $224.37 $232.50

Preschool $191.50 $199.25 $207.00 $214.75 $222.50

School-Age $180.00 $185.00 $190.00 $195.00 $200.00

     (c) Additionally, on top of the rate increases required under subsection (b) of this section,

the state shall add a twenty dollar ($20.00) per week bonus payment to the rate for infants under

age eighteen (18) months across all quality levels and settings to help cover the additional staffing

needs for this age group.

     (c) [Deleted by P.L. 2019, ch. 88, art. 13, § 4.]

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     (d) By June 30, 2004, and biennially through June 30, 2014, the department of labor and

training shall conduct an independent survey or certify an An independent survey of the then-

current weekly market rates for child care in Rhode Island and shall forward the weekly market

rate survey to the department of human services. The next survey shall be conducted by June 30,

2016 2021, and triennially thereafter. The findings of each child care market rate survey shall be

posted on the department of human services website within sixty (60) days. The departments of

human services and labor and training will jointly determine the survey criteria including, but not

limited to, rate categories and sub-categories.

     (e) In order to expand the accessibility and availability of quality child care, the department

of human services is authorized to establish, by regulation, alternative or incentive rates of

reimbursement for quality enhancements, innovative or specialized child care, and alternative

methodologies of childcare delivery, including nontraditional delivery systems and collaborations.

     (f) Effective January 1, 2007, all childcare providers have the option to be paid every two

(2) weeks and have the option of automatic direct deposit and/or electronic funds transfer of

reimbursement payments.

     (g) Effective July 1, 2019, the maximum infant/toddler reimbursement rates to be paid by

the departments of human services and children, youth and families for licensed family childcare

providers shall be implemented in a tiered manner, reflective of the quality rating the provider has

achieved within the state's quality rating system outlined in § 42-12-23.1. Tier one shall be

reimbursed two percent (2%) above the prevailing base rate for step 1 and step 2 providers, three

percent (3%) above prevailing base rate for step 3 providers, and four percent (4%) above the

prevailing base rate for step 4 providers; tier two shall be reimbursed five percent (5%) above the

prevailing base rate; tier three shall be reimbursed eleven percent (11%) above the prevailing base

rate; tier four shall be reimbursed fourteen percent (14%) above the prevailing base rate; and tier

five shall be reimbursed twenty-three percent (23%) above the prevailing base rate.

     SECTION 4. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO HUMAN SERVICES -- RHODE ISLAND CHILD CARE IS ESSENTIAL

ACT

***

     This act would make changes to the Child Care Assistance Program to cap family

copayments, expand eligibility to allow more low-income, working families to receive a subsidy

for child care, and to increase the rates paid to child care providers to meet federal equal access

standards and promote access to high-quality programs, with additional financial support for child

care programs that serve infants under eighteen (18) months of age.

     This act would take effect upon passage.

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