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Management Bulletin 08-13

Child Development Division

Attention:     Executive Directors and Program Directors of State Preschool, Prekindergarten and Family Literacy, and General Child Care Programs

Response Due Date:     Friday, January 16, 2009

Purpose

The purpose of this Management Bulletin (MB) is to notify State Preschool (CPRE and CFDP), Prekindergarten and Family Literacy (CPKP and CPKF), and General Child Care (CCTR) contractors providing services to eligible three-and four-year-old children in center-based settings of the recent changes in law resulting from the passage of Assembly Bill 2759, Chapter 308, Statutes of 2008. The bill consolidates funding for CPRE, CFDP, CPKP, CPKF, and CCTR contracts that currently provide services to eligible three-and four-year-old children in a center-based setting to create the California State Preschool Program, the largest state-funded preschool program in the nation.

Background

Prior to 1997, the California Department of Education (CDE), Child Development Division (CDD), administered two primary programs that provided center-based child development services for preschool-age children: State Preschool Part-Day and General Child Care and Development.

In 1997, additional funding was appropriated for the creation of the State Preschool Full-Day Program. On September 7, 2006, the Honorable Arnold Schwarzenegger, Governor of California, signed AB 172, Chapter 211, Statutes of 2006, creating the new CPKP and CPKF programs.

On January 22, 2008, State Superintendent of Public Instruction (SSPI), Jack O’Connell, delivered his State of Education Address. Closing the achievement gap was the primary focus of his address. One of the comprehensive approaches recommended by the SSPI’s P-16 Council included the provision of access to quality preschool programs. In addition, in an effort to streamline the existing preschool funding streams and optimize efficient program administration, AB 2759, authored by Assembly Member Dave Jones, was introduced. The bill was signed by Governor Schwarzenegger on September 25, 2008.

Statutory Requirement

AB 2759 consolidates the funding and program requirements for the five largest center-based programs providing services to eligible three-and four-year-old children including CPRE, CFDP, CPKP, CPKF, and CCTR into one contract. Except as referenced below, any agency that holds one or more of these five contracts will begin operating the California State Preschool Program part-day and/or full-day effective July 1, 2009.

For purposes of determining age eligibility for the California State Preschool Program, the same definitions of eligible three- and four-year-old children that are currently in statute for the State Preschool Program will continue to apply as follows:

• Three-year-old children are defined as children turning three on or before December 2 of the fiscal year in which they are enrolled.

• Four-year-old children are defined as children turning four on or before December 2 of the fiscal year in which they are enrolled.

Any reference to eligible three-and four-year-old children in this MB are referring to these definitions.

For agencies with existing CCTR contracts, only funding currently being used to provide center-based services to eligible three-and four-year-old children will be included in the California State Preschool Program. If an agency provides CCTR center-based services only to eligible three-and four-year-old children, all of the funding will become part of the new program.

Agencies that provide center-based services with a CCTR contract to eligible three-and four-year-old children plus services to infants and/or toddlers, and/or school-age children, and/or eligible three-and four-year-old children in family child care homes, will have two contracts after the consolidation. One contract will be a California State Preschool Program contract and the second contract will continue to be a CCTR contract.

Agencies with CCTR funding but not providing services to eligible three-and four-year-old children, and not holding one of the other four contracts referenced in the above paragraph, will not receive a California State Preschool Program contract.

In addition, CCTR contractors that use funds for eligible three-and four-year-old children receiving services in family child care homes, homes will not be included in the consolidation.

In addition to these two programs, three-and four-year-old children also receive child development center-based services in smaller programs: Migrant Child Care and Development Programs (CMIG) and programs exclusively providing services to severely disabled children (CHAN). Funding for three-and four-year-old children receiving services in CMIG and CHAN contracts will also not be consolidated.

The enacted legislation maintains some some program exceptions that apply to those agencies that received funding pursuant to AB 172, Chapter 211, Statutes of 2006, to provide CPKP and CPKF services. These exceptions are discussed in detail below.

The graphs on page 7 show how the contracts will change beginning July 1, 2009.

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California State Preschool Program Requirements

The enacted legislation amended California Education Code (EC) sections 8208, 8235, 8236, 8237, 8238.4, 8264.5, and 8266.1 and added EC sections 8236.1 and 8236.2. Sections A, B, C, and D below describe some of the program features for all California State Preschool Programs, including the unique features of part-day programs, full-day programs, and exceptions to the California State Preschool Program that include CPKP and CPKF funding.

1. All California State Preschool Programs

Contractors operating a a California State Preschool Program will have the flexibility of offering part-day services similar to CPRE and CPKP that operate from three 3 hours to 3 hours and 59 minutes per day. Contractors may also offer full-day services that operate 4 or more hours per day with adjustment factors. These services will be provided with one contract. Throughout this MB, these descriptions apply when part-day or full-day areis referenced.

Throughout this MB, references are made to part-day and full-day California State Preschool Programs. Unlike current practice with five distinct contracts, these two program designs will be provided by contractors with one contract. The segregation of the two program designs is necessary to show the differences in enrollment and program operation at the individual contractor level.

California State Preschool Programs offering part-day, full-day, or both types of services, will include:

1. Age and developmentally appropriate child development services to eligible three- and four-year-old children for up to two years before they are eligible for enrollment in kindergarten.
   
   
2. Flexibility for contractors to provide part-day services, full-day services, or both types of services as described above and in B and C below.
   
   
3. At least half of the children enrolled at each California State Preschool Program site shall be four-year-old children unless an exception to this requirement has been granted by the SSPI.
   
   
4. Utilization of a revised Attendance Report Form (CDFS 8501) designed for use only by California State Preschool Program contractors.
   
   
5. Collection and provision of data to the CDE to meet new data reporting requirements specified in EC Section 8236.1. Information regarding the amended data reporting requirements will be addressed in a future MB but it is not expected to involve significant changes to the existing data reporting requirements.

2. Part-day California State Preschool Programs

In addition to the requirements for all California State Preschool Programs referenced in A, 1 through 5 above, part-day services will also include a(n):

1. Program that is operated a minimum of 3 hours per day and less than 4 hours per day for a minimum of 175 days unless the contract specifies a lower number of days of operation. The maximum length for a part-day program is 3 hours and 59 minutes.
   
   
2. Reimbursement structure that is similar to the current CPRE contracts. For children enrolled up to four hours per day, the new math will be the new contract rates times the part-day adjustment factor of 61.72 percent. For example, if the new contract rate is $34.38, the actual payment for part-day preschool would by $34.38 x 61.72 percent = $21.22.
   
   
3. Requirement that families establish eligibility (EC 8263[a] [1]) only at the time of initial enrollment. Subsequent to enrollment, a child shall be eligible for the part-day California State Preschool Program for the remainder of the program year.
   
   
4. Provision to allow contractors to certify eligibility and enroll families 120 calendar days prior to the first day of the beginning of the new preschool year.
   
   
5. Exemption from paying family fees.

3. Full-day California State Preschool Programs

In addition to the requirements for all California State Preschool Programs referenced in A, 1 through 5 above, full-day services will also include a:

1. Program that is operated full-day that is determined by the number of hours per day necessary to meet the child care and development needs of the families and a minimum of 246 days per year unless the contract specifies a lower number of days of operation.
   
   For contractors that offer full-day and part-day services, the days of operation for the contract will be the total number of days open for service.
   
   For example, if the agency operates a full-day program in one community that is open 248 days a year, and operates a full-day program in another community that is open 248 days, but the calendar for each community is different so that one or more centers are open on 250 days a year, then the days of operation for that contractor would be 250 days.
   
   
2. Reimbursement structure that is similar to CCTR, with adjustment factors, for services provided over four hours per day.
   
   
3. Requirement that families establish eligibility at the time of initial enrollment and provide ongoing eligibility documentation as changes in income or family size occurs. If families become ineligible, the child shall continue to be eligible for only part-day services or the family shall pay the full cost of care to remain in the full-day program as a non-subsidized child. Over income families shall not receive subsidized child development services in the full-day program.
   
   
4. Requirement that the family meets one of the need requirements specified in EC Section 8263(a)(2) to receive services for four hours or more per day. Contractors must reassess need as changes occur. If the need for services drops below four hours per day, the child shall be enrolled for only part-day services.
   
   
5. Fee assessment and collection provision. Family fees will be assessed and collected based on the current CCTR requirements. For example, for children enrolled between four hours and up to six and one half hours per day, the family shall be assessed a part-time fee. For children enrolled six and one half hours and over per day, the family shall be assessed a full-time fee.

4. California State Preschool Programs with CPKP and CPKF Funding

The CPKP and CPKF programs will be consolidated into the California State Preschool Program. In addition to the requirements specified in sections A, B, and C above, the additional requirements specified in this section apply to California State Preschool Program contractors that received funding pursuant to AB 172, Chapter 211, Statutes of 2006.

California State Preschool Program contractors, with classes formerly funded by CPKP or CPKF contracts, will be able to provide services to three-and four-year-old children, not just four-year-old children.

California State Preschool Program contractors, with classes originally funded with CPKP or CPKF funds, the requirements below will apply to those specific classes. (Note: The amount of Prekindergarten and Family Literacy funds will be separately listed on the contract to allow the agency and the CDE to track those dollars.)

In addition to the requirements specified in A, B, and C, California State Preschool Program contractors offering part-day and/or full-day child care and development services:

1. Shall continue to provide California State Preschool Program services in classes originally funded by CPKP or CPKF funds in the attendance area of elementary schools in deciles 1 to 3, inclusive, based on the 2005 base Academic Performance Index pursuant to Section 52056.
   
   
2. Shall continue to provide family literacy services as specified in EC sections 8238, 8238.1, 8238.2, and 8238.3 in classes originally funded by CPKP of CPKF funds.
   
   
3. Will continue to receive $2,500 per class based on the number of classes funded pursuant to AB 172, chapter 211, Statutes of 2006, for services as listed in EC Section 8238.4(b)(1). The number of classes receiving these funds will not change as a result of the passage of AB 2759.
   
   
4. Shall continue to operate a minimum of 175 days for part-day services and 246 days for full-day, full-year services, unless the contract specifies a lower number of days of operation.

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Implementation

The CDE will implement the provisions of AB 2759 with the issuance of a new California State Preschool Program contract effective July 1, 2009. Agencies that currently hold CPRE, CFDP, CPKP and/or CPKF contracts will receive one contract with a combined maximum reimbursable amount. The contract will reference each of the different funding sources for accounting purposes.

For agencies that also currently hold a CCTR contract providing center-based services to three- and four-year-old children, that portion of the CCTR contract will be included in the California State Preschool Program contract. The remaining CCTR funds will be issued in a CCTR contract.

Agencies with CPRE, CFDP, CPKP, CPKF and/or CCTR contracts serving three-and four-year-old children in a center-based program will become California State Preschool Program contractors.

The graphic below represents the current contracts that will be included in the consolidation and how the contracts held by agencies will change as a result of the passage of AB 2759.

Current Contracts

Future Contracts

Additional specific details regarding implementation of the California State Preschool Program will be sent to contractors in a second MB. In addition, Funding Terms and Conditions (FT&Cs) are being developed for the new California State Preschool Program. A draft copy will be shared with all impacted agencies. The FT&Cs will provide additional detail about program requirements that may not be contained in this MB. The draft FT&Cs should be available before December 31, 2008.

Fiscal Requirements and Considerations

In addition to previously mentioned fiscal issues, the following fiscal requirements listed will apply to the California State Preschool Programs:

• The new contract may have multiple funding sources. These funding sources will be identified in the contract to allow the agency and the CDE to track these funds.
  
  
• The Standard Reimbursement Rate (SRR) specified in the 2009 Budget Act will apply to the new contracts. The rate of the new contract will be a blended rate.
  
  
• Full-Day California State Preschool Programs will be able to claim time-based and special criteria adjustment factors.
  
  
• The adjustment factor for part-day care (a minimum of three but fewer than four hours) shall be 61.72 percent of the contracted rate.
  
  
• A revised CDFS 8501 fiscal report will be developed for the California State Preschool Program. Contractors that also have a CCTR contract will have the flexibility to fiscally comingle their contracts. Separate enrollment and attendance pages would be submitted for each contract. One set of fiscal pages would be submitted to include revenues and expenditures for both contracts.

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Application Process

All child development contractors that hold a CPRE, CFDP, CPKP, CPKF, and/or a CCTR contract providing services to eligible three-and four-year-old children in a center-based setting in fiscal year (FY) 2008-09 must complete and submit the enclosed California State Preschool Program Application (DOC; 211KB; 4pp.) to receive a California State Preschool Program contract for FY 2009-2010.

• Cover Page and Calendar

All contractors must complete the enclosed California State Preschool Program Application Cover Page, page 1, and the Calendar – Fiscal Year 2009-2010, page 2.

The calendar must indicate the projected total number of days of operation for the California State Preschool Program for fiscal year FY 2009-2010. For agencies that plan to operate a full-day program, the minimum days of operation shall be 246 unless the agency’s current CCTR or CFDP contract specifies a lower minimum days of operation. For agencies that plan to operate only a part-day program, the minimum days of operation shall be 175 days unless the agency’s current CPRE contract specifies a lower number of days of operation.

• Calculation Worksheet

All agencies with CCTR contracts must complete the Calculation Worksheet, page 3. Contractors that do not provide child development services to eligible three-and four-year-old children in the CCTR contract will check the box on the left at the top of the page. Contractors that only provide services to eligible three-and four-year-old children will check the box on the right at the top of the page. For these two types of contractors, the remainder of the page will be left blank.

Contractors currently providing services to eligible three-and/or four-year-old children in center-based settings, plus either infants, toddlers, school-age children and/or preschool age children in family child care homes, will complete the middle and bottom section of the Calculation Worksheet. This information will be used to determine how much of the existing CCTR contract will be included in the California State Preschool Program contract.

The CDD will review and compare the information submitted on this worksheet to information submitted with the Fiscal Year FY 2009-2010 Continued Funding Application and other data currently available in the to CDE to in determining that, as much as possible, services to infants, toddlers, and school-age children will not be negatively impacted through the implementation of this bill. Agencies may be contacted for clarification based on the information included on the worksheet.

• California State Preschool Program Full-Day Self Certification

Agencies that currently operate only a CPRE or CPKP contract, that planning to offer full-day services through the California State Preschool Program contract, must also review and sign the enclosed California State Preschool Program Full-Day Self Certification on page 4.

Agencies that choose to make this change will provide services to fewer children because the daily cost of providing those services will increase but the overall funding (combined maximum reimbursable amount) will remain the same.

Agencies are not being asked to provide site information with the application. CDD will automatically update the current sites providing services through CPRE, CFDP, CPKP, and CPKF to the new California State Preschool Program contract. Agencies will be required to update CCTR sites that will be providing California State Preschool Program services after the new contract is issued. That update should occur early in the 2009-2010 fiscal year and be performed in the Child Development Management Information System Web application.

Changes to CCTR Contract Amount in Future Years

Information Sessions

The CDE/CDD anticipates holding information sessions regarding the newly enacted legislation. The sessions will include information regarding the impact to child development contractors and the completion of the application. Specific details about the information sessions, including dates, times, and locations, will be sent at a later date.

Application Due Date

Applications are due to the CDE/CDD on or before January 16, 2009. One original and three copies should be sent or delivered to:

Attention: California State Preschool Program Application
Child Development Division
California Department of Education
1430 N Street, Suite 3410
Sacramento, CA 95814-5901

Agencies that submit applications after January 16, 2009, may experience a delay in receiving the new California State Preschool Program contract for the July 1, 2009 implementation.

If you have any programmatic questions, please contact Karin Peterson, Education Fiscal Services Consultant, Child Development Division, at 916-322-4855 or by e-mail at kpeterso@cde.ca.gov.

If you have any fiscal questions, please contact Stephen Propheter, Staff Services Analyst, Fiscal and Administrative Services Division, at 916-324-6586 or by e-mail at spropheter@cde.ca.gov.

This Management Bulletin is mandatory only to the extent that it cites a specific statutory and/or regulatory requirement. Any portion of this Management Bulletin that is not supported by a specific statutory and/or regulatory requirement is not prescriptive pursuant to California Education Code Section 33308.5.

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