RECAP: November EEC Board Meeting—Child Care Subsidy Reimbursement Rates & Proposed Revisions to Subsidy System Regulations
RECAP: November EEC Board Meeting—Child Care Subsidy Reimbursement Rates & Proposed Revisions to Subsidy System Regulations
At Neighborhood Villages, we prioritize keeping up with the policy landscape in the early education and care field, both across the country and in Massachusetts. That includes tuning-in to the monthly meetings of the Massachusetts Board of Early Education and Care (EEC), to stay apprised of updates and to identify opportunities for how we can work with government and other stakeholders to improve our early education and care system.
This month’s EEC Board meeting covered a lot of ground, including:
A modified proposal and vote on the child care subsidy reimbursement rate for providers participating in the subsidy system[1];
Proposed changes to the regulations governing the state’s child care subsidy system; and
Fiscal Year 2024 (FY24) budget priorities.
I. The EEC Board approved a proposal to increase the child care subsidy.
As we wrote last month, at the October EEC Board meeting, Acting Commissioner of the Department of Early Education and Care (EEC) Amy Kershaw presented a proposal for subsidy reimbursement rates, given the results of its recent Market Rate Survey[2] and additional state funds at its disposal. (In the Massachusetts Fiscal Year 2023 [FY23] state budget, Massachusetts allocated $60 million to be used for raising the base subsidy reimbursement rate for Group and School Age [GSA] providers participating in the state subsidy system.) This month, at the November 8 Board meeting, Commissioner Kershaw proposed that the Board approve allocating the $60 million such that:
All center-based child care providers in the subsidy system would receive an approximately 10 percent increase over current rates. This “across-the-board increase,” in addition to other targeted increases, will ensure that all rates meet or exceed the 30th percentile of market prices;
A 10 percent across-the-board increase for family child care (FCC) providers; and
An increase to the daily add-on (i.e., an additional amount to what a program would otherwise receive from a subsidy) for providers serving vulnerable populations.[3]
EEC will recommend that these increases be maintained and annualized into the base rates for child care subsidies in fiscal year 2024.
The EEC Board voted to approve the proposal. Given the Board’s approval, EEC will move forward with the proposal as presented, distributing funds to early education and care providers in December of this year.
Here’s what it means to bring the reimbursement level to the 30th percentile of the market: As was explained in our October post, the percentile of the market identifies the share of providers who charge at or below a specified amount for tuition. Bringing all providers to the 30th percentile indicates that the subsidy reimbursement rate will be equal to or greater than the tuition at or below which 30 percent of child care providers reported charging families.
II. EEC proposed changes to state regulations that govern the subsidy system. The objective of these changes is to reduce red tape for parents and families.
In April 2022, EEC began undertaking a formal review of Massachusetts’ subsidy system, a process that included:
Surveying families
Reviewing the EEC strategic plan
Reviewing legislative reports
Interviewing EEC staff
Interviewing Child Care Resource and Referral (CCRR) agency staff
Interviewing Mass211 staff
Reviewing current regulations, policies, and procedures
Synthesizing their findings into key pain points in the subsidy system
Run a pilot of the intake application and waitlist reconciliation
Assess feedback from the pilot and iterate
Conduct ‘Visioning Sessions’ with various stakeholder groups
With the information gathered, EEC drafted a set of proposed regulatory changes and presented them to the EEC Board. The 42 proposed changes fall into three priority areas:
Source: EEC Board Materials, 11/8/22
Examples of proposed changes include:
● Increasing overall system efficiency. EEC’s proposed modifications to regulations impacting systems efficiency included, amongst other revisions, changing the requirement that both parents need to sign an application for a subsidy. Now, only one parent is required to sign.
● Prioritizing family needs and experience. EEC’s proposed changes to regulations that address prioritization of family needs and experience included, amongst other modifications, amending the definition of “disability” to include parents participating in a drug treatment or drug rehabilitation program and expanding authorization for disability as a service need from two years to three years. EEC also proposed requiring subsidy administrators to notify families no fewer than two times about the end of their eligibility period (no fewer than 60 days prior to the end).
● Modernizing and updating the system. EEC’s proposed changes to regulations aimed at modernizing and updating the subsidy system included, amongst other modifications, amending regulations to allow families a provisional authorization for a subsidy, if they are unable to provide documentation at the time of reauthorization; inserting a non-discrimination policy; and removing subsidy-eligibility limitations on home-based self-employment activities.
The proposed regulations represent significant positive changes for families navigating the subsidy system.
III. Fiscal Year 2024 (FY24) budget priorities reflect state’s commitment to sustained momentum for investment in early education and care
At the Board meeting, EEC outlined its Fiscal Year 2024 (FY24) budget priorities, which aim to leverage investments made in the FY23 budget. As presented by Acting Commissioner Kershaw, EEC’s FY24 budget priorities are:
● Supporting Family Economic Mobility by Expanding Access to Child Care Financial Assistance[4]
● Reforming and Updating the Child Care Financial Assistance Rate Structure
● Developing a Workforce Strategy
● Prioritizing Access to Child Care Financial Assistance for Early Education & Care Staff
● Continuing the Commonwealth Cares for Children Operational Grants Program (C3)
● FCC Homeownership & Improvement Program
● Developing an Early Education and Care Program Safety Initiative That is Aligned with School Safety Initiatives
● Incentivizing Innovation (EEC proposed establishing an Innovation Fund to serve as an incubator to pilot new models of child care that can help improve access for those who need non-traditional hours.)
● Building Agency Capacity to Respond to Challenges & Opportunities Now and in the Future
The FY24 state budget process begins with EEC’s submission of its priorities to the Governor. We will keep you apprised of how the FY24 budget is developing, once budget season officially kicks-off!
[1] See here for additional context on the subsidy reimbursement rate.
[2] See last here for additional context on the Market Rate Survey.
[3] DCF involved families, young parents, and families experiencing homelessness
[4] Herein, Child Care Financial Assistance can be understood as a reference to the Massachusetts child care subsidy system.