Big child care victory! Rate increases included in the state budget

June 17, 2016

UPDATE: Victory! On June 28, 2016, after receiving urgent calls from UDW family child care providers, Governor Brown signed the state budget for fiscal year 2016-17 into law. Rate increases are expected to go into effect on January 1, 2017.

This year, UDW family child care providers have united to urge California lawmakers to fix the child care crisis. Parents who need a safe and reliable place to take their kids while they work are struggling to access affordable quality care. And because of low rates, family child care providers are barely making enough money to keep our daycares open.

One of our major priorities this year was a real investment in child care in the state budget. Together, we strategized in our monthly meetings and made calls to our elected leaders urging them to support a budget proposal that would put hundreds of millions of dollars into the child care system.

And this week, we won!

The legislature passed a budget that invests an estimated $528 million in child care and early education programs. Of the $528 million, a majority of the funding will be used to increase subsidy reimbursement rates over the next two years. The increase in rates will make it easier for us to afford the increased wage we must pay our assistants due to the recent state minimum wage increase.

The budget deal:

  • Increases the Standard Reimbursement Rate (SRR) by 10%.
  • Increases the Regional Market Rate (RMR) to the 75th percentile of the 2014 RMR survey, with a provision that ensures providers are never reimbursed at a rate less than their current rate.
  • Increases the License-Exempt Rate from 65% to 70% of the Family Child Care Home Rate.
  • Allows the state to increase subsidy rates in the future when minimum wage increases go into effect, which will help providers afford the increased costs of paying our assistants the higher minimum wage.
  • Includes a future plan to reimburse child care providers at the 85th percentile of the most recent RMR survey and to update the RMR ceiling with each new survey, if funding is available.
  • Includes a plan to increase the RMR ceilings through the 2018-19 fiscal year, to help providers afford the higher costs of paying our assistants the increased minimum wage.

The budget is now headed to Governor Brown’s desk to be signed before June 30th.

But our work is not yet done. Lawmakers can do more this year to make child care affordable and accessible to parents, and to stabilize our daycares. We will continue to urge the legislature to pass Assembly Bill 2150, which will:

  • Guarantee parents who qualify, 12 months of child care eligibility, so they can count on stable access to care
  • Update the State Median Income, so that more parents who need it can access and keep their child care subsidies

This year and beyond, UDW child care providers will continue to organize and build power, so that we can fix California’s child care crisis together.

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