2026 -- S 2667 SUBSTITUTE A

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2026

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A N   A C T

RELATING TO HUMAN SERVICES -- THE RHODE ISLAND WORKS PROGRAM--

RHODE ISLAND CHILD CARE IS ESSENTIAL ACT

     Introduced By: Senators Vargas, DiMario, Urso, Murray, and DiPalma

     Date Introduced: February 27, 2026

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 40-5.2-20 and 40-5.2-35 of the General Laws in Chapter 40-5.2

entitled "The Rhode Island Works Program" are 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 two hundred sixty-one percent (261%) two hundred eighty-five

percent (285%) 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. The

department shall also provide child care to families with incomes below two hundred sixty-one

percent (261%) two hundred eighty-five percent (285%) of the federal 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. Effective from January 1, 2021,

through June 30, 2022, the department shall also provide childcare assistance to families with

incomes below one hundred eighty percent (180%) of the federal poverty level when such

assistance is necessary for a member of these families to enroll or maintain enrollment in a Rhode

Island public institution of higher education provided that eligibility to receive funding is capped

when expenditures reach $200,000 for this provision. Effective July 1, 2022 through December 31,

2024, the department shall also provide childcare assistance to families with incomes below two

hundred percent (200%) of the federal poverty level when such assistance is necessary for a

member of these families to enroll or maintain enrollment in a Rhode Island public institution of

higher education. Effective from January 1, 2025 through December 31, 2026, the department shall

also provide childcare assistance to families with incomes below two hundred sixty-one percent

(261%) of the federal poverty level when such assistance is necessary for a member of these

families to enroll or maintain enrollment in a Rhode Island public institution of higher education.

Effective on January 1, 2027, the department shall also provide childcare assistance to families

with incomes below two hundred eighty-five percent (285%) of the federal poverty level when such

assistance is necessary for a member of these families to enroll or maintain enrollment in a Rhode

Island public institution of higher education.

     (c) The department shall also provide childcare assistance to families who meet the

requirements of the protective services group. For the purposes of this section, "protective services

group” means foster or kinship children served through the department of children, youth and

families as well as the children of childcare educators as defined in subsection (l) of this section.

     (c)(d) 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)(e) 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

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

accordance with the applicable sections of title 15, 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)(f) For purposes of this section, “appropriate child care” means child care, including

infant, toddler, preschool, 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)(g)(1) Families with incomes 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 two hundred percent (200%) 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, not

to exceed seven percent (7%) of income as defined in subsection (h) of this section.

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

childcare assistance as a result of their incomes exceeding two hundred sixty-one percent (261%)

two hundred eighty-five percent (285%) of the applicable federal poverty guidelines shall continue

to be eligible for childcare assistance until their incomes exceed three hundred percent (300%) three

hundred twenty-five percent (325%) 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, not to exceed seven percent (7%) of income as

defined in subsection (h) of this section, and in accordance with all other eligibility standards.

     (g)(h) 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)(i) 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)(j) 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)(k) 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

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discharged from active duty.

     (k)(l) Effective from August 1, 2023, through July 31, 20282030, the department shall

provide funding for child care for eligible childcare educators, and childcare staff, who work at

least twenty (20) hours a week in licensed childcare centers and licensed family childcare homes

as defined in the department’s rules and regulations. Eligibility is limited to qualifying childcare

educators and childcare staff with family incomes up to three hundred percent (300%) of the

applicable federal poverty guidelines and will have no copayments. This protective service group

shall continue to be eligible for childcare assistance until their incomes exceed three hundred

twenty-five percent (325%) of the applicable federal poverty guidelines. Qualifying participants

may select the childcare center or family childcare home for their children. The department shall

promulgate regulations necessary to implement this section, and will collect applicant and

participant data to report estimated demand for state-funded child care for eligible childcare

educators and childcare staff. The report shall be due annually to the governor and the general

assembly by November 1.

     40-5.2-35. Child support pass-through.

     For any month in which a noncustodial parent makes a child support payment in the month

when due and the support is collected by the department of human services, for a child or children

receiving cash assistance pursuant to this chapter, in a household of one child the first fifty dollars

($50.00) one hundred dollars ($100) of the child support payment, or the actual amount of the child

support payment if the payment is less than fifty dollars ($50.00) one hundred dollars ($100), shall

be paid to the family in which the child resides; in a household of two (2) or more children the first

two hundred dollars ($200) of the child support payment, or the actual amount of the child support

payment if the payment is less than two hundred dollars ($200), shall be paid to the family in which

the child resides. If more than one noncustodial parent makes a child support payment to children

living in the same family, there shall only be one payment of fifty ($50.00) one hundred dollars

($100) for a household of one child, or two hundred dollars ($200) for a household with two (2) or

more children paid to the family from the child support collected. This payment is known as the

“pass through” payment and shall be sent to the family within two (2) business days of the

determination that the amount is due and owing and no later than within two (2) business days of

the end of the month in which the support was collected.

     SECTION 2. 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.

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

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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

      Infant $182.00

      Preschool $150.00

      School-Age $135.00

     Licensed Family Childcare Providers 75th Percentile of Weekly 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.

     (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

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.

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     (2) For preschool reimbursement rates, 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 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.

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

     (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 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, and

triennially thereafter. 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.

     (h) Through December 31, 2021, the maximum reimbursement rates paid by the

departments of human services, and children, youth and families to licensed childcare centers shall

be consistent with the enhanced emergency rates provided as of June 1, 2021, as follows:

      Tier 1 Tier 2 Tier 3 Tier 4 Tier 5

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Infant/Toddler $257.54 $257.54 $257.54 $257.54 $273.00

Preschool Age $195.67 $195.67 $195.67 $195.67 $260.00

School Age $200.00 $200.00 $200.00 $200.00 $245.00

The maximum reimbursement rates paid by the departments of human services, and

children, youth and families to licensed family childcare providers shall be consistent with the

enhanced emergency rates provided as of June 1, 2021, as follows:

      Tier 1 Tier 2 Tier 3 Tier 4 Tier 5

Infant/Toddler $224.43 $224.43 $224.43 $224.43 $224.43

Preschool Age $171.45 $171.45 $171.45 $171.45 $171.45

School Age $162.30 $162.30 $162.30 $162.30 $162.30

(i) Effective January 1, 2022, the maximum reimbursement rates to be paid by the

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

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. Maximum weekly rates shall be

reimbursed as follows:

     Licensed Childcare Centers

      Tier One Tier Two Tier Three Tier Four Tier Five

Infant/Toddler $236.36 $244.88 $257.15 $268.74 $284.39

Preschool $207.51 $212.27 $218.45 $223.50 $231.39

School-Age $180.38 $182.77 $185.17 $187.57 $189.97

     The maximum reimbursement rates for licensed family childcare providers paid by the

departments of human services, and children, youth and families is determined through collective

bargaining. The maximum reimbursement rates for infant/toddler and preschool age children paid

to licensed family childcare providers by both departments is implemented in a tiered manner that

reflects the quality rating the provider has achieved in accordance with § 42-12-23.1.

     (j) Effective July 1, 2022, the maximum reimbursement rates to be paid by the departments

of human services and children, youth and families for licensed childcare centers 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. Maximum weekly rates shall be

reimbursed as follows:

     Licensed Childcare Centers

      Tier One Tier Two Tier Three Tier Four Tier Five

Infant/Toddler $265 $270 $282 $289 $300

Preschool $225 $235 $243 $250 $260

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School-Age $200 $205 $220 $238 $250

     (k) Effective July 1, 2024, the maximum reimbursement rates to be paid by the departments

of human services and children, youth and families for licensed childcare centers 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. Maximum weekly rates shall be

reimbursed as follows:

     Licensed Childcare Centers

      Tier One Tier Two Tier Three Tier Four Tier Five

Infant/Toddler $278 $284 $296 $303 $315

Preschool $236 $247 $255 $263 $273

School-Age $210 $215 $231 $250 $263

     (l) Effective July 1, 2025, the maximum reimbursement rates to be paid by the departments

of human services and children, youth and families for licensed childcare centers 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. Maximum weekly rates shall be

reimbursed as follows:

      Tier 1 Tier 2 Tier 3 Tier 4 Tier 5

Infant $334 $341 $355 $364 $378

Toddlers $278 $284 $296 $303 $315

Preschoolers $236 $247 $255 $263 $273

School Age $210 $215 $231 $250 $263

     (m) Effective July 1, 2026, the maximum reimbursement rates to be paid by the

departments of human services and children, youth and families for licensed childcare centers 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. Maximum weekly rates shall be

reimbursed as follows:

      Tier 1 Tier 2 Tier 3 Tier 4 Tier 5

Infant $351 $358 $373 $382 $397

Toddlers $278 $284 $296 $303 $315

Preschoolers $236 $247 $255 $263 $273

School Age $210 $215 $231 $250 $263

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     SECTION 3. Section 1 of this act shall take effect after January 1, 2027, except for the

provisions of § 40-5.2-20(c) which shall take effect July 1, 2026. Section 2 of this act shall take

effect July 1, 2026.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO HUMAN SERVICES -- THE RHODE ISLAND WORKS PROGRAM--

RHODE ISLAND CHILD CARE IS ESSENTIAL ACT

***

     This act would increase the income limit for eligible families from two hundred sixty-one

percent (261%) to two hundred eighty-five percent (285%) of the federal poverty level (FPL)

beginning January 1, 2027, and would increase the exit threshold from three hundred percent

(300%) to three hundred twenty-five percent (325%). This act would also increase the

reimbursement rates for infants by five percent (5%).

     Section 1 of this act would take effect after January 1, 2027, except for the provisions of §

40-5.2-20(c) which would take effect July 1, 2026. Section 2 of this act would take effect July 1,

2026.

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