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2018-19 budget proposals for child care and early learning

On Wednesday, January 10, Governor Brown released his proposed budget for 2018-2019.  The governor reiterated the importance of fully funding the “Rainy Day Fund” to establish fiscal security for future administrations in the event of another recession.  Other significant proposals include full funding of the Local Control Funding Formula (LCFF) for K-12 education and the creation of a fully online California community college.

The governor proposed to increase child care and preschool programs by $399 million, bringing total state funding to $4.4 billion in this area.  Of these funds, almost half ($2.168 billion) are dedicated to preschool programs and Transitional Kindergarten.

Here is a breakdown of the main proposals for child care and early learning:

Full Implementation of the Regional Market Rate (RMR) Increase

The governor proposed full implementation of the Regional Market Rate reimbursement rate increase which went into effect January 1, 2018 for providers who care for children in the Alternative Payment and CalWORKs program.  The governor also proposed to permanently extend the hold harmless provision for the RMR, which ensures that no provider receives a lower rate than they did in 2015-16.

Standard Reimbursement Rate (SRR) increase for Title 5 Contracted Centers

The governor proposed to increase the SRR by 2.795% for State Preschool and General Child Care Programs. 

Cost of Living Adjustment (COLA) and Statutory Growth Adjustment

The governor proposed a 2.51% COLA for non-CalWORKs child care and state preschool programs, with a proposed decrease in slots to reflect a -0.48% growth factor based on decreased child population.

One-Time Funds

The governor’s proposed budget includes $167 million in one-time funding for a competitive grant to increase the availability of inclusive early education care to children ages 0 to 5. The grant will be open to both Local Education Agency (LEA) and Community Based providers to be used to a variety of purposes including renovations, trainings and equipment.

What’s next?

The two houses of the legislature, the California State Assembly and the California State Senate, will begin to review the proposed budget through budget subcommittee hearings in the spring.  This will be followed by the release of the governor’s revised budget proposal in mid-May, which will reflect actual tax revenues after California residents have paid their 2017 taxes.  Final budget hearings will be scheduled in May and early June.  The legislature is expected to complete an on-time proposal by June 15th, and then Governor Brown has until June 30th to sign the budget bill into law.

As always, we will keep you informed as we learn more.  If you have any questions, contact our Director of Government Relations, Donna Sneeringer, at [email protected].

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