State and Federal Legislative and Policy Updates

1. State and Federal Legislative and Policy Updates Alameda County Early Care and Education Planning Council January 23, 2015

2. Overview --Updates • Governor’s Budget Proposal • Current Year Funding in Alameda County • Federal Update

3. Governor’s Budget Proposal • The Governor proposes to spend $113.3 billion from the state’s General Fund in 2015-16, an increase of $1.6 billion (1.4 percent) over the estimated spending level for the current fiscal year (2014-15).

4. Governor’s Budget Proposal • He proposes to set aside a portion of revenues – $2.4 billion – and put half in the state’s rainy day fund and half to pay down budgetary debt. • He includes $4 billion more for the state’s new TK-12 school finance system ($50.7 billion total). • “Our long-term fiscal health depends on the wise and prudent actions we take today.”

5. Governor’s Budget: Early Care and Education • No big changes • $21.5 million for 1.58% COLA for General Child Care, State Preschool, Alternative Payment Programs, Planning Councils • $33.5 million: Continues Funds from Current Year Regional Market Rate (RMR) Increase • $37 million: Continues Funding from Current Year for Preschool Expansion

6. Governor’s Budget: Early Care and Education • Stage 2: Decrease of $11.6 million to reflect caseload drop and increase in cost per case • Stage 3: Increase of $28.6 million to reflect caseload increase and increase in cost per case

7. Community Care Licensing • $3 million increase • (Ongoing staff costs are around $14 million) • 28.5 positions for backlog of complaints and expand training and technical assistance • Beginning January 2017, DSS will increase inspection frequency to 3 years for all facilities • Beginning January 2018, every two years for all EXCEPT child care • Annually by 2019 for all adult care and residential care facilities for the elderly

8. Community Care Licensing • Licensing Website has more information about inspections, complaints and violations • Center for Investigative Reporting has scanned inspections reports and related documentation and is available online

9. Related Issues: Cal Works • Reflects the 5 percent increase in the CalWORKs grant – effective April 2015 – that was part of the 2014-15 budget agreement, but assumes no additional grant increase in 2015-16 • Levels remain lower than before Great Recession

10. Current Year ECE Funding in Alameda County • Preschool Restoration: 347 Slots (most through Kidango or YMCA of Central Bay Area) • Preschool Expansion: No funding allocated to our County but $4,345,427 applied for. No awards announced yet. • CCTR Restoration(infants and toddlers): 80 slots

11. Federal • Early Head Start/Child Care Partnership grants announced. All three Alameda County applicants will receive funding (CAPE, YMCA of the Central Bay Area and Alameda Family Services) • In Alameda County, tentative results: • 161 slots • Enhanced slots in Oakland, Berkeley, Hayward and Dublin) • Child Care Block Grant Reauthorization will bring major changes (annual licensing visits, annual eligibility) could cost $5 billion nationally but no funds available

12. President’s State of the Union

13. State of the Union • The President’s budget is released on February 2—but here’s what we know about the child care tax credit proposal so far: • Families with children under 5 could claim a maximum credit of $3,000 per child (50 percent of up to $6,000 of child care expenses per child under 5). • The maximum credit would be available to families with incomes up to $120,000. 

14. State of the Union • The credit would remain non-refundable (families with incomes too low to owe federal income taxes would not benefit from the credit). • The expanded tax credit would replace child care flexible spending accounts, which allows employees whose employers offer such plans to exclude up to $5,000 in child care expenses from their taxable income. • More to come in President’s budget…