Early childhood education and childcare.

The California Assembly Committee on Budget proposes substantial changes to early childhood education and childcare funding through legislation that modifies reimbursement structures, eligibility periods, and administrative requirements. The bill extends the monthly cost of care plus rate through June 2026 while allocating additional funds for subsidized childcare programs.

The legislation adjusts documentation requirements for childcare providers, reducing the minimum documented need for daily rate reimbursements from 6 to 5 hours. For families already receiving services who add a child during their eligibility period, the bill extends coverage to ensure the additional child receives at least 12 months of eligibility before redetermination.

Beginning July 2025, the measure implements reimbursement based on families' certified childcare needs rather than attendance, supported by an $88.5 million General Fund appropriation. The bill also suspends the annual cost-of-living adjustment for childcare and development programs in fiscal year 2025-26 while establishing that future reimbursement rates will be informed by an alternative methodology rather than market rate surveys.

The legislation requires quarterly implementation updates to legislative budget committees through July 2027, including details on progress toward prospective payment systems and enrollment-based reimbursement. These changes aim to create a unified rate structure across state-subsidized childcare programs, with rates varying based on geography, care setting type, regulatory requirements, time categories, and child age.