AB 1981: Subsidized childcare: reimbursement rates: reporting.

Official summary

Legislative Counsel’s Digest (official, as of the latest version). Written by nonpartisan legislative staff; reproduced verbatim.

Existing law requires the State Department of Social Services, in collaboration with the State Department of Education, to implement a reimbursement system plan that establishes reasonable standards and assigned reimbursement rates for subsidized childcare and development services, and to develop and conduct an alternative methodology for ratesetting, as specified.

Existing law requires the Governor and the Legislature to, by no later than July 1, 2025, establish reimbursement rates based on the alternative methodology, as specified. Existing law requires the department to provide quarterly updates from October 1, 2024, to July 1, 2027, inclusive, on the implementation of the new reimbursement rates set under the alternative methodology. If the new reimbursement rates do not take effect on July 1, 2025, existing law also requires the department to provide the Legislature with a timeline for transitioning from the rates that are in effect on July 1, 2025, to the new established rates.

This bill would instead, under those circumstances, require the department to provide the Chairperson of the Joint Legislative Budget Committee with the department’s anticipated timeline for the above-described rate transition. The bill would also require the quarterly reports described above to continue until July 1, 2028.

Existing law states the intent of the Legislature that the reimbursement rates established under the alternative methodology satisfy certain parameters, including, among others, that the rates vary based on geography, type of care setting, regulatory requirements applicable to each type of care setting, time categories, and child age.

This bill would impose various requirements on the department, in consultation with the State Department of Education, when establishing new reimbursement rates using a single-rate structure informed by the alternative methodology, to the extent those requirements are consistent with the approved Child Care and Development Fund state plan. Among other things, the bill would require the department to vary rates based on geographic regions and specific age groupings and to include in the rates an enhanced rate for nonstandard hours of care and enhanced inclusion rates for children with special needs. The bill would authorize the department to implement these provisions by means of all-county letters, childcare bulletins, or similar written instructions.

This bill would incorporate additional changes to Section 10227.6 of the Welfare and Institutions Code proposed by AB 190 or SB 190 to be operative only if this bill and AB 190 or SB 190 are enacted and this bill is enacted last.

Sponsors

Sponsors by party (alphabetical): Democratic 8

“Support” is shown only as formal sponsorship recorded by the legislature. Roll-call votes are available on the official bill page.

Recent official actions

1. September 27, 2026Chaptered by Secretary of State - Chapter 567, Statutes of 2026.
2. September 27, 2026Approved by the Governor.
3. September 14, 2026Enrolled and presented to the Governor at 1:30 p.m.
4. August 31, 2026Senate amendments concurred in. To Engrossing and Enrolling. (Ayes 79. Noes 0. Page 6965.).
5. August 30, 2026In Assembly. Concurrence in Senate amendments pending.
6. August 30, 2026Read third time. Urgency clause adopted. Passed. Ordered to the Assembly. (Ayes 40. Noes 0.).
7. August 28, 2026Read second time. Ordered to third reading.
8. August 27, 2026Read third time and amended. Ordered to second reading.
9. August 24, 2026Read second time. Ordered to third reading.
10. August 21, 2026Read third time and amended. Ordered to second reading.
11. August 13, 2026Read second time. Ordered to third reading.
12. August 13, 2026From committee: Do pass. (Ayes 7. Noes 0.) (August 13).