FY14 SEIU Rate Increase Presentation to the Fiscal Committee February 3, 2014

1. FY14 SEIU Rate IncreasePresentation to the Fiscal CommitteeFebruary 3, 2014

2. SEIU Rate Increase • In FY2013 EEC entered into negotiations with the Family Child Care Providers and SEIU. • The following language is an excerpt from Chapter 189 of the Acts of 2012 Family child care providers shall be considered public employees for negotiation purposes for child care subsidized rates for low income families. The Department acting through the Commissioner, shall be the employer, solely for the purposes of saidchapter 150E and said sections 17A, 17G and 17J of said chapter 180 and deductions under said sections 17A, 17G and 17J of said chapter 180 may be made by any entity authorized by the commonwealth to compensate family child care providers under a rate structure for voucher and contracted payments. • The agreement calls for a 4% increase effective July 1, 2013. • 2.3% of the increase for all subsidized child care daily rates is funded by the Consolidated Net Surplus approved by the Board December 10, 2013. • 1.7% will require a supplemental appropriation from the Legislature. • The negotiated contract calls for future rate increases in accordance to the following schedule: • FY14: 4% (2.3% CNS; 1.7% supplemental) • FY15: 3% • FY16: 3%

3. Historical Rate Increases

4. SEIU Rate Increase: Overview • Implementation • TheSEIU negotiated rate increase is 4% of which approximately 1.7% will be funded by a request for supplemental funds following contract ratification. • The 1.7% increase applies to all family child care program types, regions, and age groups. • The same percentage increase will be applied to all family child care regions, age groups, and program types. • Family Child Care Systems Rate includes an administration fee. The administration fee increase will be limited to the 2.3% funded by the CNS Surplus. The increase will be retroactive to July 1, 2013. See the chart below. The rate prior to the 2.3% increase was $10.50; it will increase to $10.74. The FCC Systems Admin Fee will not infringe on the SEIU negotiated rate of 4% received by the providers. • Union Dues, Agency Fees, and Objection Fees will be deducted and remitted to the union. • The increase will be implemented in March for payments in April.

5. SEIU Rate Increase: Some Details Implementation of SEIU Rate Increase • A Board vote is required. • A 1.7% rate increase will be funded by a supplemental appropriation to support the FCC rate increase. • The increase will be applied to all family child care regions and program types. • The supportive add-on rate and transportation rate will not be affected. • The Daily Reimbursement Rate Chart will be updated to reflect the rate increase. • Contract amendments will be required because encumbrances will be increased. • ECCIMs provider contract lines (by program type) will be updated to reflect the increase. • CCIMs provider profiles maintain private pay rates; providers eligible for the rate increase will not receive more than their private pay rate. • Contract Providers will receive the rate increase once all amendments have been completed and changes to CCIMS and ECCIMS have been completed and tested. • Parent fees will not be impacted. Parent fees are based on income and family size.