PROPOSED RULEMAKING
DEPARTMENT OF
HUMAN SERVICES
[ 55 PA. CODE CHS. 3041 AND 3042 ]
Subsidized Child Care Eligibility
[50 Pa.B. 6361]
[Saturday, November 14, 2020]The Department of Human Services (Department) under the authority of sections 201(2), 403(b) and 403.1 of the Human Services Code (62 P.S. §§ 201(2), 403(b) and 403.1) proposes to rescind Chapter 3041 and adopt Chapter 3042 (relating to subsidized child care eligibility) as set forth in Annex A.
Purpose of the Proposed Rulemaking
Subsidized child care is a benefit made available through limited Federal and State funds. The current subsidized child care regulations in Chapter 3041 provide the eligibility criteria a parent or caretaker must meet to obtain and maintain assistance with child care costs through the subsidized child care program. The regulations also set forth the procedures the eligibility agency shall follow in administering the subsidized child care program.
This proposed rulemaking proposes to rescind and reserve Chapter 3041 and replace Chapter 3041 with Chapter 3042.
This proposed rulemaking is needed to address the requirements set forth in the Federal Child Care and Development Block Grant of 2014 (CCDBG) (42 U.S.C.A. §§ 9857—9858r, as reauthorized by Pub.L. No. 113-186). The CCDBG, along with section 418 of the Social Security Act (42 U.S.C.A. § 618), authorizes the Child Care and Development Fund (CCDF). The CCDF is the primary Federal funding source devoted to assisting low-income families that are working or participating in education or training activities with paying for child care and improving the quality of child care for all children.
This proposed rulemaking is needed to ensure the Commonwealth's compliance with the CCDBG, which provides more than $197 million in funding to support child care services in this Commonwealth. The original CCDBG authorized in 1996 included the first mandates for child care in the United States. The CCDBG provides assistance to low-income families by making funds available to child care providers that provide services to these families, establishing baseline health and safety protections for child care providers that receive funds, and requiring states to use a portion of the funds to improve the quality of child care services. The Congressional reauthorization of the CCDBG made clear the importance of continuity of child care in supporting a parent's or caretaker's ability to achieve financial stability and a child's ability to develop a nurturing relationship with the child's child care provider, which creates the foundation for a high-quality early learning experience.
Background
The Department has worked with child development and community service advocates, child care providers, eligibility agencies and other interested stakeholders in drafting this proposed rulemaking. The Department has also worked with the Federal Office of Child Care (OCC), Administration for Children and Families (ACF), Department of Health and Human Services (HHS) to understand the Federal requirements, as well as to obtain clarification about and ensure compliance with the CCDBG.
Requirements
This proposed rulemaking will comply with the Federal requirements set forth in the CCDBG and help low-income families more easily obtain affordable, accessible and high-quality child care. Compliance with the CCDBG will also allow the Commonwealth maximum flexibility in developing child care policies that best meet the needs of children and their families in this Commonwealth.
Section 658E(c)(2)(N)(i) of the CCDBG (42 U.S.C.A. § 9858c(c)(2)(N)(i)) requires extending children's eligibility for child care to a minimum of 12 months, regardless of temporary changes in participation in work, training or education. This requirement will enable parents to maintain employment or complete education programs, and supports both family financial stability and the relationship between children and their child care providers. A parent or caretaker will not need to report a loss of work or a decrease in work hours between 12-month redetermination periods. Subsidized child care eligibility and payment will continue for the full 12-month eligibility period.
Between eligibility redeterminations, a parent or caretaker will only be required to report when the family's annual income exceeds 85% of the State Median Income (SMI) (45 CFR 98.20(a)(2)(i) and (ii) (relating to a child's eligibility for child care services)). A parent or caretaker will now only be required to report: a loss or decrease in hours of work, education or training; a change in the number of days or hours during which the child needs care; or a change in family size and composition at redetermination. Continuity and stability of child care contributes to improved job stability and is important to a family's financial health. Family economic stability is undermined by policies that result in unnecessary disruptions to receipt of affordable child care in the form of a subsidy. Removing policies that present administrative barriers and make it difficult for parents and caretakers to maintain their eligibility and thus fully benefit from the support subsidy offers is important.
The Department intends to create a child care system that not only supports families in their efforts to achieve and maintain financial self-sufficiency, but also promotes the healthy development of children. Continuity of care is of vital importance to the healthy development of young children. Disruptions in care can stunt or delay socio-emotional and cognitive development in children. Safe, stable environments allow young children the opportunity to develop the relationships and trust necessary to comfortably explore and learn from their surroundings. Research has demonstrated a relationship between child care stability and social competence, behavior outcomes, cognitive outcomes, language development, school adjustment and overall child well-being. Adams, G. and Rohacek, M. (2010). ''Child Care Instability: Definitions, Context, and Policy Implications.'' The Urban Institute, page 6. Retrieved from https://www.urban.org/research/publication/child-care-instability-definitions-context-and -policy-implications.
According to the Economic Report of The President (March 2014), investments in early childhood development will reap economic benefits now and in the future. Immediate benefits include increased parental earnings and employment. Future benefits come when children who experience high-quality early care and education opportunities are prepared for success in school and go on to earn higher wages as adults.
A cost-savings study conducted by the Department of Education's Pennsylvania Build Initiative: The Cost Savings to Special Education (October 2005), concluded that if high-quality early care and education were made available to all children in this Commonwealth, the number of students requiring special education services would be reduced by 2,380, saving taxpayers in this Commonwealth between $68 and $102 million over the course of the children's Kindergarten through 12th grade education. According to the study, for every $1 invested, the Department of Education will save $0.16 to $0.31 elsewhere in the school system, which could prevent as many as 1,700 children from committing crimes when they grow up. Additional future tax savings are possible because children who are better educated are likely to earn higher income as adults, likely to be healthier, pay more taxes and less likely to require public assistance.
In addition to making changes to the regulation as required by the CCDBG, the Department is propos- ing other changes to better ensure child care continuity and stability of care. The eligibility agency will continue child care eligibility and payment until the end of the child's 12-month eligibility period when a child's parent or caretaker loses employment, education or training, whether the loss is temporary or permanent. At initial and ongoing eligibility determinations, the parent or caretaker must work a minimum of 20 hours per week, or work a minimum of 10 hours combined with a minimum of 10 hours of training per week. If a parent or caretaker experiences a loss of work, education or training between 12-month eligibility redeterminations, section 658E(c)(2)(N) of the CCDBG offers the Commonwealth some options.
States may discontinue subsidy due to a parent's or caretaker's loss of work, education or training that is not considered temporary, as long as the eligibility agency continues subsidy for a minimum 3-month period. The OCC has interpreted ''temporary'' to be, at minimum: (1) any time-limited absence from work; (2) any interruption in work for a seasonal employee; (3) any student or holiday break in a parent's or caretaker's education and training schedule; (4) a reduction in hours of work, education or training; or (5) any other cessation of work, education or training that does not exceed 3 months or a longer period of time determined by the Commonwealth (45 CFR 98.21(a)(1)(ii) (relating to eligibility determination processes)). This definition is in line with Congressional intent to stabilize assistance for working families as part of two-generational strategies. Two-generational strategies focus on creating opportunities for and addressing needs of both vulnerable children and their parents simultaneously, so the family can succeed together. Connecting low-income families with early care and education, in addition to opportunities to achieve financial stability, may help break the cycle of poverty.
States must consider all changes on this list to be temporary, but are not limited by this definition and may consider additional changes to be temporary, including longer periods of time for eligibility (45 CFR 98.21(a)(2)). Many low-income families likely do not have a consistent work history pattern, but many are also managing more than one job and experience significant fluctuations in schedules and work history. The Department originally contemplated the option of discontinuing child care if the parent did not find new employment, education or training within the 3-month period. However, a review for the period December 2015 through December 2016 showed that child care was discontinued for about 300 families, or 1% of all families being provided services in the program, each month because the parent or caretaker did not find new employment or training within the 3-month period.
The level of effort needed to track work history, job-search activity and the system changes needed to support it are not commensurate with the 1% of families affected by this requirement. Additionally, many of these families eventually returned to the program through new employment obtained after the 3-month period, or through receipt of Temporary Assistance for Needy Families (TANF) benefits. This change has the net effect of providing families the remainder of their 12-month eligibility period so the parent or caretaker may find other work that meets the requirement. Continuation of child care for the full 12-month eligibility period best meets the needs of the family during difficult times and provides stability for the child.
The Department also proposes changes that will allow an increased ability to align child care eligibility periods with other programs serving low-income children, such as Head Start and Early Head Start. Aligning these programs will allow the eligibility agency to continue child care payment for the child through the completion of the child's Head Start or Early Head Start program.
Additional proposed changes include provisions to allow a period of presumptive eligibility for a parent or caretaker experiencing homelessness. This period of presumptive eligibility will provide a parent or caretaker experiencing homelessness additional time to submit verification and secure work, education or training.
Historically, families cycle in and out of the subsidized child care program. Parents or caretakers find jobs, then lose jobs, resulting in loss of eligibility and subsidy. Children leave their early care and education program only to need early care and education again in a few months and be placed on a waiting list until funds become available. This cycling in and out is disruptive to a child's ability to learn and to a parent's or caretaker's ability to work and is not an effective use of taxpayer dollars. Stability of child care arrangements can affect children's healthy development, especially for vulnerable children who may be at special risk of poor developmental outcomes. Adams, G. and Rohacek, M. (2010). ''Child Care Instability: Definitions, Context, and Policy Implications.'' The Urban Institute, page 6. Retrieved from https://www.urban.org/research/publication/child-care-instability -definitions-context-and-policy-implications.
New CCDBG Requirements
This proposed rulemaking will stabilize a parent's or caretaker's access to child care subsidy and, in turn, help stabilize the parent's or caretaker's employment or education, and the child's care arrangement. Section 658E(c)(2)(E) of the CCDBG expanded requirements for the content of consumer education available to parents receiving CCDF assistance, the public and where applicable, child care providers. By adding child care providers, Congress recognized the positive role trusted providers could play in communicating and collaborating with parents on a daily basis regarding their children's development.
This proposed rulemaking has the potential to stabilize the revenue of child care providers that receive subsidy payments, as they experience more predictable and reliable payments for services. Strengthening the stability of providers providing services to children is important. Provider instability can lead to instability in a parent's or caretaker's employment, which is an outcome that undercuts a core principle of the CCDBG to ensure children have access to child care that is comparable to the care available to unsubsidized families.
These requirements facilitate a two-generation approach that supports work, education and training for parents or caretakers, as well as access to high-quality, coordinated early care and education services for the children. This approach will maximize a parent's or caretaker's options; support a parent or caretaker in finding and maintaining employment; improve the development of participating children; and increase the number and percentage of low-income children participating in high-quality child care settings.
This proposed rulemaking also substantially reorganizes the existing subsidized child care chapter to meet the requirements of the CCDBG. Therefore, the Department proposes a new chapter to replace the existing regulations. In addition, simplification of regulatory language will make the eligibility process easier to understand. Proposed Chapter 3042 replaces Chapter 3041 in its entirety.
Following is a summary of the major proposed amendments required by the CCDBG:
§§ 3042.1—3042.4 General provisions
This proposed rulemaking complies with the CCDBG statute and regulation in section 658E(c)(2)(N)(i) and 45 CFR 98.14(a)(1) (relating to plan process) and 98.41(a)(1)(i)(C) (relating to health and safety requirements) by allowing a period of presumptive eligibility for a parent or caretaker experiencing homelessness. This proposed rulemaking defines ''homelessness,'' as well as a ''period of presumptive eligibility.'' ''Homelessness'' refers to an individual who lacks a fixed, regular and adequate nighttime residence as set forth in section 725(2) of the McKinney-Vento Homeless Assistance Act (42 U.S.C.A. § 11434a(2)). A ''period of presumptive eligibility'' means a temporary period not to exceed 92 calendar days, during which a family is eligible for subsidized child care under certain conditions. During the 92-day period of presumptive eligibility, a parent or caretaker in a family that is experiencing homelessness may substitute job search activities to meet the work requirement at the time of application or redetermination.
This proposed rulemaking includes procedures the eligibility agency must follow when granting a period of presumptive eligibility, which are discussed in further detail under §§ 3042.141—3042.147.
This proposed rulemaking defines ''SMI'' and ensures that a family shall remain eligible for subsidized child care following the initial determination of eligibility as long as the family's annual income does not exceed 85% of the SMI, as required by the CCDBG regulation (45 CFR 98.20(a)(2)(i)). In addition, this proposed rulemaking ensures the family's income shall not exceed 235% of the Federal Poverty Income Guidelines (FPIG) or 85% of the SMI at the time of the redetermination.
§§ 3042.11—3042.21 General benefits
This proposed rulemaking expands eligibility for a child who turns 13 years of age before the expiration of the child's 12-month eligibility period, as required by the CCDBG regulation (45 CFR 98.21(a)(1)(ii)(F)). The CCDBG requires the eligibility agency to complete a redetermination of a child's eligibility for child care services no sooner than 12 months following the initial determination or most recent redetermination. This proposed rulemaking complies with the CCDBG by assuring the child will remain eligible for the full 12-month eligibility period, unless the family's annual income exceeds 85% of the SMI (45 CFR 98.20(a)(2)(i) and (ii)).
This proposed rulemaking restricts the types of child care providers that may receive payment to comply with section 658E(c)(2)(K)(i)(IV)) of the CCDBG. The CCDBG requires licensing inspectors or qualified inspectors designated by the Department to perform an annual inspection of each provider in the state receiving payment under the CCDF, unless the provider is a relative. Section 658P(6)(B) of the CCDBG (42 U.S.C.A. § 9858n(6)(B)), however, defines a relative provider as being exempt from the inspection requirement.
All other providers receiving funding are certified child care providers subject to health and safety requirements, including the annual inspection. Congress established minimum health and safety standards, including mandatory criminal background checks, at least annual monitoring of child care providers, and health and safety training. Children in CCDF-funded child care will now receive care from providers certified by the Department and that have had basic training in health and safety practices and child development.
This proposed rulemaking attempts to bring a basic level of safety to all children whose care is supported with taxpayer funds. Health and safety is a necessary foundation for care that supports early learning and development. It is critical that the support that the child care subsidized families receive is of sufficient quality. This proposed rulemaking supports this goal of ensuring quality of care by requiring that providers providing CCDF-funded services to children have background checks, receive basic training in health and safety and are monitored on a regular basis.
In addition, this proposed rulemaking restricts when the Department's grantee may enroll additional children with a child care provider when the Department determines the provider is not meeting health and safety requirements and revokes or refuses to renew the provider's certificate of compliance.
This proposed rulemaking allows continuity of care for the remainder of a child's required 12-month eligibility period during a break in or following the loss of work, education or training, as required by the CCDBG regulation (45 CFR 98.21(a)(1)). The intent is to stabilize assistance for families through changes in circumstance, which allows a parent or caretaker time to resume work or attendance at a job training or educational activity.
Continuity of care will provide some measure of stability in instances where parents or caretakers, despite their best efforts, cycle in and out of employment. In these instances, when the home life may be in flux, a level of stability in the child's care arrangement becomes that much more valuable. Instability in the child's care arrangement further disrupts the parent's or caretaker's employment and education, harms children and runs counter to nearly all the purposes of the CCDBG regulation (45 CFR 98.1 (relating to purposes)). In addition, this proposed rulemaking allows continuity of care for the remainder of a child's required 12-month eligibility period when there is a change in the child's primary parent or caretaker, so long as the family's annual income does not exceed 85% of the SMI.
This ensures continuity of care for children experiencing the trauma of a parent or caretaker leaving the home for reasons including death, inpatient treatment, incarceration or military deployment (45 CFR 98.1(b)(7)). The CCDBG regulation prohibits the Department from acting on information between 12-month redetermination periods that would reduce the family's subsidy unless the information provided indicates the family's income exceeds 85% of SMI (45 CFR 98.20(a)(2) and 98.21(e)(4)(ii)).
This proposed rulemaking also ensures continuity of care by expanding the reasons a parent or caretaker may request a child's subsidy be suspended, rather than terminated by the eligibility agency. For example, a child's subsidy may be suspended when the child does not need care for more than 5 consecutive days, but will return to care within the minimum 12-month eligibility period required by the CCDBG statute and regulation (42 U.S.C.A. § 9858c(c)(2)(N)(i) and 45 CFR 98.20(a) and (b)(4)).
In addition, this proposed rulemaking removes the restriction on the number of days during which the eligibility agency may suspend the child's subsidy. This proposed rulemaking permits the eligibility agency to suspend subsidy for as long as needed. The eligibility agency can end the child's eligibility before the expiration of the child's 12-month eligibility period if the parent indicates there is no longer a need for care as permitted by the CCDBG regulation (45 CFR 98.21(a)(5)).
Despite the requirement to provide a minimum 12-month eligibility period following the initial determination of eligibility, the CCDBG does not require the parent or caretaker to continue receiving services nor does it force the child to remain with a provider if the parent or caretaker no longer chooses to receive such services. By allowing the eligibility agency to suspend care for a period up to the family's redetermination due date, the Department will not be obligated to pay for care that is not being used. Suspending care and not paying the provider permits the Department to use funds to provide subsidized child care to children on the waiting list.
This proposed rulemaking expands the total number of paid absences in a State fiscal year from 25 days to 40 days. After the child has been absent for 40 days, the child remains eligible, but the parent or caretaker is responsible to pay to the child care provider the provider's verified published daily rate for each day of absence starting with the 41st day of absence. The eligibility agency resets the number of absences accrued for each child to coincide with the beginning of the State fiscal year. This supports the intent of the CCDBG regulation to delink payment for child care from a child's occasional absences. See 45 CFR 98.45(l)(2)(iv) (relating to equal access). This proposed rulemaking allows the Department to address concerns from families receiving subsidy around absences for children with verified, significant illnesses, injuries and impairments.
This proposed rulemaking aligns payment practices for subsidized child care with those for other early care and education programs such as Pennsylvania PreK Counts, and provides child care providers greater financial stability. This proposed rulemaking aligns the number of paid absence days more closely with the number of paid absence days provided by other states and territories in the region; those range from 44 per year in Virginia to 240 in the District of Columbia. This proposed rulemaking follows the CCDBG that requires the eligibility agency to make multiple attempts to contact families and providers to determine a continued need for child care when the child has excessive unexplained absences (45 CFR 98.21(a)(5)). The eligibility agency may adjust the child's schedule based on the parent's or caretaker's request.
§§ 3042.31—3042.37 Eligibility requirements
This proposed rulemaking ensures that a family shall remain eligible for subsidized child care following the initial determination of eligibility as long as the family's annual income does not exceed 85% of the SMI as required by the CCDBG regulation (45 CFR 98.20(a)(2)). In addition, this proposed rulemaking ensures the family's income shall not exceed 235% of the Federal Poverty Income Guidelines (FPIG) or 85% of the SMI at the time of the redetermination (45 CFR 98.21(b)).
This proposed rulemaking permits a single parent or caretaker who experiences the onset of a disability following application to maintain eligibility for the remainder of the 12-month eligibility period as required by the CCDBG regulation (45 CFR 98.14(a)(1)). During the remainder of the minimum 12-month eligibility period, the CCDBG permits the eligibility agency to excuse the parent or caretaker from the work, education and training requirements until the family's 12-month eligibility period expires and the eligibility agency completes the family's annual redetermination (45 CFR 98.21(a)(1)).
§§ 3042.51—3042.57 Eligibility determination
As required by the CCDBG statute and regulation under section 658E(c)(2)(N)(i)(I) and 45 CFR 98.20(a)(2)), this proposed rulemaking requires a parent or caretaker to notify the eligibility agency when the family's annual income exceeds 85% of the SMI.
§§ 3042.61—3042.74 Self-certification and verification
The eligibility agency will collect only the verification that is necessary to make an eligibility determination. To comply with the CCDBG regulation (45 CFR 98.20(a)(2)), a parent or caretaker will be required to submit verification during the family's 12-month eligibility period only when the family's annual income exceeds 85% of the SMI. Therefore, this proposed rulemaking reduces verification requirements for families and prevents unnecessary subsidy eligibility loss.
§§ 3042.81—3042.88 Eligibility agency responsibilities
As required by the CCDBG regulation (45 CFR 98.21(e)(4)), this proposed rulemaking allows the eligibility agency to act on any change reported by a parent or caretaker that benefits the family. A parent or caretaker has the option of reporting information on an ongoing basis, particularly information that would be beneficial to assistance, such as an increase in work hours that necessitates additional child care hours or a loss of earnings that could result in a reduction of the family co-payment. A parent's or caretaker's ability to report changes in circumstances will not be restricted, particularly in cases where a parent or caretaker may have entered into more stressful or vulnerable situations, or would be eligible for additional child care assistance.
Although the eligibility agency must act on reported changes between 12-month eligibility redeterminations if it would increase the family's benefit, the eligibility agency may not act on reported changes that would reduce the family's benefit, with the following exceptions:
• The family's income exceeds 85% of the SMI.
• The family moves out-of-State.
• The parent voluntarily requests discontinuance of service.
• The parent commits substantiated fraud or intentional program violations.
• The child has excessive, unexplained absences. The agency must make multiple attempts to contact the family and provider prior to terminating services.
These provisions comply with the Federal HHS recommendation to eliminate or reduce policies that result in unnecessary disruptions to receipt of a subsidy and make it difficult for parents and caretakers to maintain their eligibility. See Final Rule on CCDF Program Final Rule at 81 FR 67438, 67445 (September 30, 2016).
§§ 3042.101 and 3042.102 Eligibility redetermination
This proposed rulemaking requires the eligibility agency to complete a redetermination of eligibility no sooner than every 12 months as required by the CCDBG regulation (45 CFR 98.21(a)). At redetermination, families must meet all eligibility requirements with the exception of the circumstances under which the eligibility agency permits a period of presumptive eligibility. Income limits may not exceed 235% of the FPIG or 85% of the SMI.
As required by the CCDBG regulation (45 CFR 98.21(b)(1)), the Department must allow a phase-out period when income increases above initial eligibility limits. The Commonwealth provides this phase-out period by allowing families to enter the program at 200% or less of the FPIG and remain eligible up to 235% of the FPIG, which allows parents and caretakers to accept raises or higher paying positions without immediately losing child care benefits.
§§ 3042.111—3042.122 Former TANF families
As required by the CCDBG regulation (45 CFR 98.14(a)(1)), this proposed rulemaking allows continuity of care for a former TANF family during the required 12-month eligibility period so long as the family's annual income does not exceed 85% of the SMI. Former TANF families have up to 183 calendar days following the date TANF benefits end to contact the eligibility agency for assistance with their child care costs. This proposed rulemaking will eliminate the need for the eligibility agency to complete an eligibility redetermination on the 184th day following the date TANF benefits ended. In addition, this proposed rulemaking ensures a former TANF family is not eligible if a parent or caretaker is disqualified from receiving TANF benefits as specified in §§ 255.1(c) and 275.51 (relating to restitution and disqualification policy; and imposing the disqualification).
The CCDBG regulation (45 CFR 98.21(a)(5)(A)(iii)) allows for the discontinuance of child care when there is substantiated fraud or an intentional program violation by a parent or caretaker that invalidates prior determinations of eligibility. It is important to ensure the Department uses CCDF funds effectively and efficiently targets the use of CCDF funds towards eligible low-income families.
§§ 3042.141—3042.147 Waivers and periods of presumptive eligibility
This proposed rulemaking complies with the CCDBG regulation (45 CFR 98.14(a)(1) and 98.41(a)(1)(i)(C)) by allowing a period of presumptive eligibility for a parent or caretaker experiencing homelessness. In addition, this proposed rulemaking allows a parent or caretaker who is experiencing homelessness to request a waiver of certain eligibility and verification requirements. This proposed rulemaking permits additional time to acquire documents that demonstrate eligibility, which allows a child experiencing homelessness to receive subsidy while allowing the child's parent or caretaker reasonable time to comply with immunization and other health and safety requirements.
The Department appreciates the extra assistance and support that may be necessary to help families experiencing homelessness to stabilize their living situations. This proposed rulemaking allows a parent or caretaker experiencing homelessness to substitute job search activities to meet work requirements for up to 92 calendar days from the date of application or redetermination. This proposed rulemaking also allows the eligibility agency to grant a period of presumptive eligibility at application or redetermination for a parent or caretaker who is experiencing homelessness.
The eligibility agency will ensure the parent or caretaker meets all eligibility requirements upon expiration of the period of presumptive eligibility. Upon expiration of the period of presumptive eligibility, the eligibility agency will complete a full redetermination to establish the 12-month eligibility period and reset the redetermination due date.
Additional Changes Proposed by the Department
This proposed rulemaking reduces reporting requirements, as permitted by the CCDBG, and allows additional options for a parent or caretaker when submitting acceptable eligibility verification. This proposed rulemaking will make it easier to coordinate child care services with other programs serving low-income children, such as Head Start and Early Head Start. This coordination of care complies with the Federal HHS recommendation to promote stability of child care programs and allow for greater alignment between child care services, Head Start and Early Head Start for families in poverty that rely on child care subsidy to participate in work, education or training. See Child Care and Develop- ment Fund (CCDF) Program Final Rule at 81 FR 67438, 67450 (September 30, 2016).
Following is a summary of the major proposed revisions in addition to the Federal requirements. Some of the revisions are based on the intent of the CCDBG, while the remainder of the revisions clarify and support the subsidized child care program.
§§ 3042.1—3042.4 General provisions
This proposed rulemaking expands the definition of ''caretaker who does not need legal custody of the child'' and includes the child's great-grandparent and sibling who is 18 years of age or older. These individuals may be considered having care and control of the child without having a court order awarding them legal custody of the child. The current regulation limits individuals who can have care and control of the child without a court order to grandparents, aunts and uncles. Including these additional individuals aligns with the CCDBG definition of ''relatives.'' This proposed rulemaking permits close family members to care for children without incurring additional expenses, such as legal and court fees.
This proposed rulemaking expands the definition of ''education'' to include charter schools, cyber schools and any other program approved by the school district or the Department of Education. The current regulation allows only for elementary school, middle school, junior high or a high school program including a general educational development program.
This proposed rulemaking defines ''Head Start'' and ''Early Head Start.'' ''Early Head Start'' means a program that serves families with at-risk children from birth to 3 years of age. ''Head Start'' means a program designed to prepare at-risk children, 3 years of age or older but under 5 years of age, for school success. These definitions are critical to identifying the children who may qualify for subsidy under a special eligibility program.
This proposed rulemaking defines ''owner or operator of a child care facility'' as the legal entity or individual that owns the facility, or the legal entity or a person designated by the legal entity to serve as the facility director.
This proposed rulemaking allows a 92-day period of presumptive eligibility at redetermination for a family with a parent or caretaker who is on leave approved by the Department and who has verified work, education or training that will begin within 92 calendar days of the redetermination date. For example, a parent or caretaker who is on maternity leave or temporary disability leave at the time the family's redetermination is due will need to verify that the parent's or caretaker's work, education or training meets the work-hour requirement within 92 calendar days from the family's redetermination date.
This proposed rulemaking redefines self-employment as operating one's own business, trade or profession for profit. While earning a profit is required, this change removes the mandate that a parent or caretaker make a profit greater than or equal to the hourly State minimum wage. This ensures that a self-employed parent or caretaker shall meet the same income limits as a parent or caretaker who is not self-employed. At the time of initial application and redetermination of eligibility, a family that includes a self-employed parent or caretaker is ineligible if the family's annual income exceeds 200% of the FPIG or 85% of the SMI, whichever is lesser. In between redetermination periods, a family that includes a self-employed parent or caretaker is ineligible if the family's annual income exceeds 85% of the SMI.
This proposed rulemaking defines ''tiered-reimburse- ment'' as an amount the Department sets and adds to a provider's payment rate if the provider meets additional quality standards.
§§ 3042.11—3042.21 General benefits
This proposed rulemaking expands the hours of uninterrupted sleep time during which a parent or caretaker is eligible for subsidized child care. This change will permit payment of subsidy when the parent or caretaker requires sleep time following the end of an overnight work shift and does not place limitations on the time the work shift must end. This change supports the needs of the child whose parent or caretaker works at night and must sleep after the work shift ends to be a productive caregiver and worker on the following day.
The Federal HHS encourages states to increase the quality of child care providers and set rates that consider the additional costs of higher-quality child care. See Child Care and Development Fund (CCDF) Program Final Rule at 81 FR 67438, 67440 (September 30, 2016). This proposed rulemaking permits the Department to direct and prioritize funding to child care providers that meet additional quality standards. The amount of the tiered-reimbursement is based on the level of quality the provider maintains and the amount of time the child receives care from the provider in a day. The Department provides tiered-reimbursement based on the availability of funding; therefore, the amount and availability of tiered-reimbursement is subject to change. Tiered-reimbursement, based on the Keystone STARS rating, recognizes providers that are Keystone STARS-certified and promotes continuous quality improvements in early care and education environments. This funding change includes paying tiered-reimbursement based on a child care provider's quality rating or, as recommended by the CCDBG, entering into contracted slots based on the child care provider's quality rating. See 42 U.S.C.A. § 9858e(b) and 45 CFR 98.53.
This proposed rulemaking restricts retroactive payment for child care to 30 calendar days, with the exception of former TANF families as specified in § 3042.119 (relating to retroactive payment for former TANF families). Former TANF families have up to 183 calendar days following the date TANF benefits end to contact the eligibility agency for assistance with their child care costs. This restriction allows the Department to better utilize funds for low-income families that have not received TANF benefits and are ready to enroll their children.
The CCDBG statute and regulation under section 658E(c)(2)(A)—(M) and 45 CFR 98.30 and 98.53, mandate quality child care settings. In the general comments section of the Federal implementing regulation, the ACF indicated that it can no longer ''in good conscience'' use Federal taxpayer dollars to support sub-standard child care for our nation's most vulnerable and disadvantaged children. See 81 FR 67438, 67446 (September 30, 2016). In response to this comment, this proposed rulemaking prohibits new enrollments of children receiving subsidy when the Department determines the provider is not meeting health and safety requirements, and revokes or refuses to renew the provider's certificate of compliance. Private-pay parents and caretakers may decide to continue paying such providers; however, the Department intends to limit public funding to providers that are currently certified by the Department, but do not meet basic health and safety requirements. To provide continued stability and support already established staff and child relationships, the Department will continue to pay for children who are currently enrolled at the time of the sanction.
This proposed rulemaking provides low-income families the same rights as other families by permitting the parent or caretaker the opportunity to decide if a child is ready to start kindergarten. This allows a parent or caretaker to hold a child back from attending kindergarten for 1 year and continue to receive full subsidy payments. The current regulation requires a parent or caretaker who is receiving subsidy to enroll the child in kindergarten, if available, if the child will be 5 years of age before September 1 of the upcoming school year.
This proposed rulemaking permits families to postpone enrollment for more than 30 calendar days if the child does not immediately need care when funding becomes available. Historically, there have been a variety of circumstances in which a child may not immediately need care when funding becomes available and the current regulation resulted in ineligibility. Families experiencing these types of circumstances would be forced to reapply for services and the child would be subject once again to the waiting list. For example, if funding becomes available during the school year for a school-aged child who needs care only during the summer months, the parent or caretaker may postpone the enrollment and that child may remain eligible while in suspended status until the child needs care.
This proposed rulemaking allows a child to remain eligible for subsidy when the child is absent for more than 5 consecutive days; however, this proposed rulemaking also prohibits payment until the child returns to care following the absences. The eligibility agency will suspend payment when a child is absent for more than 5 consecutive days. This change will allow a child who is frequently absent due to illness or other reasons to maintain eligibility. Under the current regulation, the child would become ineligible after 5 consecutive absences, the parent or caretaker would be required to reapply for services and the child would be subject once again to the waiting list.
This proposed rulemaking expands the total number of paid absences in a State fiscal year from 25 days to 40 days. After the child has been absent for 40 days, the child remains eligible but the parent or caretaker is responsible to pay to the child care provider the provider's verified published daily rate for each day of absence starting with the 41st day of absence. The eligibility agency resets the number of absences accrued for each child to coincide with the beginning of the State fiscal year. This supports the intent of the CCDBG regulation to delink payment for child care from a child's occasional absences. See 45 CFR 98.45(l)(2)(iv). This proposed rulemaking allows the Department to address concerns from families receiving subsidy around absences for children with verified, significant illnesses, injuries and impairments. This proposed rulemaking follows the CCDBG that the eligibility agency shall make multiple attempts to contact families and providers to determine a continued need for child care when the child has excessive unexplained absences. The eligibility agency may adjust the child's schedule based on the parent's or caretaker's request.
§§ 3042.51—3042.57 Eligibility determination
This proposed rulemaking permits the eligibility agency to substitute a telephone contact for a face-to-face meeting if the eligibility agency cannot schedule a face-to-face meeting without the parent or caretaker experiencing a hardship. The current regulation only provides this provision for former TANF families. In addition, this proposed rulemaking permits the eligibility agency to waive the face-to-face meeting if the parent or caretaker has completed a face-to-face meeting within the past 12 months.
§§ 3042.61—3042.74 Self-certification and verification
This proposed rulemaking allows additional opportunities for a parent or caretaker to self-certify information that is not likely to change within the 12-month eligibility period, such as the inclusion of an adult child in the family composition, and the days and hours for which the child needs care. The current regulation restricts the ability to self-certify the days and hours for which the child needs care to those parents or caretakers that have previously received TANF benefits.
This proposed rulemaking allows for additional options for a parent or caretaker when submitting acceptable eligibility verification. The CCDBG regulation (45 CFR 98.21(e)(2)) provides that the eligibility agency only asks for information that has changed and not require a parent or caretaker to resubmit verification if it has been collected in the past (for example, children's birth certificates, parents' identification and the like) or is available from other electronic data sources (for example, verified data from other benefit programs).
This proposed rulemaking expands verification of income from self-employment to allow a parent or caretaker to complete the Department's self-employment verification form indicating gross earnings minus allowable costs of doing business, which shows a profit. In addition, this proposed rulemaking requires verification of foster child status from the local children and youth agency or other government or social service agency.
§§ 3042.91—3042.99 Co-payment and payment by the Department
This proposed rulemaking removes the requirement for a parent or caretaker to pay an equivalent advance co-payment to the child care provider when the eligibility agency enrolls a child in care. The current regulation establishes a barrier to a parent or caretaker who is attempting to become more self-sufficient. The requirement is also difficult for the eligibility agency to enforce. Payment of an advanced co-payment is an issue between the parent or caretaker and the child care provider, and should not affect a family's eligibility for subsidy.
§§ 3042.111—3042.122 Former TANF families
This proposed rulemaking deletes the requirement for a parent or caretaker who previously received TANF benefits to pay an equivalent advance co-payment to the child care provider when the eligibility agency enrolls a child in care. As discussed in the previous section, the current regulation also establishes the same barrier to a parent or caretaker who is transitioning off TANF benefits and attempting to become more self-sufficient. Children whose parents or caretakers have received TANF benefits and are transitioning off those benefits are some of this State's most at-risk children. Many former TANF parents or caretakers are transitioning off TANF benefits because the parents or caretakers found employment and the family's income exceeds TANF income limits. These families are already facing an adjustment to paying a co-payment toward their child care costs. To establish an additional barrier of requiring these families to pay an equivalent advance co-payment is unnecessary.
Requirements Maintained from the Current Regulation
This proposed rulemaking maintains the language and requirements of the current regulation with regard to the following sections:
(1) Sections 3042.141—3042.147 apply to individuals experiencing domestic violence.
(2) Sections 3042.151—3042.159 apply to notification and right to appeal.
(3) Sections 3042.161—3042.166 apply to appeal and hearing procedures.
(4) Sections 3042.171—3042.179 apply to overpayment and disqualification.
Affected Individuals and Organizations
This proposed rulemaking affects children who receive subsidized child care, parents and caretakers who apply for or receive subsidy, child care providers and eligibility agencies. Children and their parents or caretakers are affected by the requirements in this proposed rulemaking that specify the eligibility conditions, reporting requirements and verification requirements that they must meet to access subsidized child care. The longer, stabilized 12-month eligibility periods may, however, increase the number of children on the waiting list.
This proposed rulemaking may decrease the workload of the eligibility agencies, allowing more time for eligibility agencies to help families find child care and provide information about a parent's or caretaker's options regarding quality child care. Eligibility agencies will also be able to refer families to services that encompass the total family's needs, such as providing referrals to Medical Assistance, the Children's Health Insurance Program, Women, Infants and Children Program, and Early Intervention Services.
This proposed rulemaking affects child care providers because there are changes to the eligibility conditions for families currently provided services or that may be provided services in the future. In addition, children will remain eligible for a full 12-month eligibility period, so child care providers may experience stability in the monthly child care payment received from the Department for subsidized child care services. Providers that receive CCDF funds may also experience more predictable and reliable payments for services.
Accomplishments and Benefits
This proposed rulemaking benefits children and low-income families by allowing easier access to affordable, high-quality child care. This proposed rulemaking allows more families to be eligible for subsidized child care benefits for longer periods, and complies with the CCDBG, which requires a minimum 12-month eligibility period. This change will allow a family to remain eligible for an entire year before having to provide verification to establish continued eligibility, thus allowing for continuity and stability of care.
This proposed rulemaking further benefits children by providing stabilized, high-quality, learning environments that result in better outcomes for children, increase school readiness and provide steady, nurturing relationships for children for significant periods. This proposed rulemaking will provide support to a low-income parent or caretaker who is working or looking for work by reducing unnecessary verifications.
This proposed rulemaking benefits child care providers by allowing stable, predictable income from the subsidized child care program. For every dollar the Commonwealth invests in early care and education, more than $2 circulates throughout local economies through employment and purchasing of goods and services. Likewise, for every ten jobs created in the State's early care and education sector, three jobs are created outside that sector.
Fiscal Impact
The Department does not anticipate this proposed rulemaking will result in additional cost to the Commonwealth, local governments, the parents and caretakers receiving subsidized child care, the child care providers or the eligibility agencies.
Paperwork Requirements
This proposed rulemaking will result in reduced paperwork and recordkeeping for a parent or caretaker and the eligibility agency. A parent or caretaker will only be required to complete an eligibility redetermination every 12 months, instead of every 6 months. This proposed rulemaking also reduces reporting requirements for a parent or caretaker during the family's 12-month eligibility period; therefore, the need for a parent or caretaker to provide verification to the eligibility agency may also decrease.
Reduced reporting and paperwork requirements will remove unnecessary tracking of a parent's or caretaker's status by the eligibility agency. The reduction in paperwork and tracking may allow more funding for direct services and will provide stability and continuity in the program. Policies that result in unnecessary disruptions to receipt of a subsidy, or other administrative processes that make it difficult for parents to maintain their eligibility and thus fully benefit from the support it offers, undermine family economic stability.
Effective Date
This proposed rulemaking is effective 30 calendar days after final-form publication in the Pennsylvania Bulletin.
Public Comment
Interested persons may submit written comments, suggestions or objections regarding this proposed rulemaking to Jessica Sands, Department of Human Services, Office of Child Development and Early Learning, 333 Market Street, Harrisburg, PA 17011, jsands@pa.gov, within 30 calendar days after the date of publication of this proposed rulemaking in the Pennsylvania Bulletin. Reference Regulation No. 14-545 when submitting comments. Persons with a disability who require an auxiliary aid or service may submit comments by using the Pennsylvania AT&T Relay Service at (800) 654-5984 (TDD users) or (800) 654-5988 (voice users).
Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P.S. § 745.5(a)), on October 22, 2020, the Department submitted a copy of this proposed rulemaking and a copy of a Regulatory Analysis Form to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the House Children and Youth Committee and the Senate Health and Human Services Committee. A copy of this form is available to the public upon request.
Under section 5(g) of the Regulatory Review Act, IRRC may convey comments, recommendations or objections to the proposed rulemaking within 30 days of the close of the public comment period. The comments, recommendations or objections must specify the regulatory review criteria in section 5.2 of the Regulatory Review Act (71 P.S. § 745.5b) which have not been met. The Regulatory Review Act specifies detailed procedures for review prior to final publication of the rulemaking by the Department, the General Assembly and the Governor.
TERESA D. MILLER,
SecretaryFiscal Note: 14-545. No fiscal impact; (8) recommends adoption.
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