Effective Date of Rule: October 1, 2010.

     Purpose: Amending working connections child care (WCCC) and seasonal child care (SCC) program rules in chapter 170-290 WAC. The department of early learning (DEL) is changing the countable income limit for families to be eligible for WCCC and SCC subsidies, to one hundred seventy-five percent of the federal poverty guidelines (FPG). The current income limit is two hundred percent of the FPG. The change will mean families with countable income between one hundred seventy-five percent up to two hundred percent of the FPG will no longer be eligible for WCCC or SCC subsidies.

     Citation of Existing Rules Affected by this Order: Amending WAC 170-290-0005, 170-290-0075, 170-290-0085, 170-290-3520, and 170-290-3640.

     Statutory Authority for Adoption: RCW 43.215.060 and 43.215.070.

     Other Authority: Chapter 43.215 RCW.

     Under RCW 34.05.350 the agency for good cause finds that immediate adoption, amendment, or repeal of a rule is necessary for the preservation of the public health, safety, or general welfare, and that observing the time requirements of notice and opportunity to comment upon adoption of a permanent rule would be contrary to the public interest; and that in order to implement the requirements or reductions in appropriations enacted in any budget for fiscal years 2009, 2010, or 2011, which necessitates the need for the immediate adoption, amendment, or repeal of a rule, and that observing the time requirements of notice and opportunity to comment upon adoption of a permanent rule would be contrary to the fiscal needs or requirements of the agency.

     Reasons for this Finding: An emergency rule is necessary to amend the WCCC and SCC WAC to prevent these programs from running out of funds in state fiscal year 2011, which ends on June 30, 2011, and to avert a broad termination of benefits to all families receiving child care subsidies. Continuing these programs at the current maximum eligibility level would result in the programs becoming overburdened due to insufficient funds and increased caseloads. The governor has determined that a shortfall is imminent and has directed agencies to implement cuts by October 1.

     The state budget is faced with significant challenges now and for the foreseeable future. Revenue forecasts for Washington state government continue to show projected general fund revenue down for the two-year period ending June 30, 2011. This follows a $9 billion shortfall, representing about twenty seven percent of the state's general fund operating budget. The September state revenue forecast released on September 16, 2010, projects an additional drop in tax collections between September and the end of state fiscal year 2013. The projected shortfall in the 2011-2013 budget is anticipated to be between $3 and $4 billion dollars.

     The legislature projected potential shortfall in the WorkFirst budget. The 2010-2011 supplemental operating budget bill (ESSB 6444) anticipated that federal revenues in the WorkFirst "TANF box" may fall short of estimates.

     As of August 2010, Washington's temporary assistance for needy families (TANF) program, WorkFirst, faced a $51 million budget shortfall for fiscal year 2011. The shortfall is the result of increased demand for the program due to the economic recession, together with declining resources. In the last two years, the WorkFirst caseload has grown by more than thirty percent, from 51,106 cases in July 2008 to 66,634 cases in June 2010.

     On August 12, 2010, the governor directed agencies that form the WorkFirst subcabinet to take measures to reduce WorkFirst expenditures. As part of those measures across multiple programs, DEL revised the income limit for WCCC subsidy eligibility, from two hundred percent of the FPG to one hundred seventy-five percent of FPG. DEL is also applying the income limit to families in the SCC program.

     It is anticipated that reducing eligibility to one hundred seventy-five percent of FPG effective October 1, 2010, will save $14.78 million, and is expected to impact about two thousand five hundred families who would no longer qualify for a WCCC subsidy, which represents about six percent of the current WCCC caseload. Each month that the department waits to implement this change will result in more families who are impacted by the budget shortfall. Reducing the FPG level sooner may help to avoid or delay additional budget cuts and the broad termination of child care subsidy benefits later on.

     In addition, the governor has determined that a budget shortfall is imminent and has directed agencies to implement cuts by October 1 to avoid running out of state general funds. In particular, the Governor's Executive Order 10-04 (Ordering Expenditure Reductions in Allotments of State General Fund Appropriations), signed on September 13, 2010, found that:

•	Revenues have fallen short of projections;
•	The current official state economic and revenue forecast of general fund revenues is less than the official estimate upon which the state's 2009-2011 biennial operating budget and supplemental operating budget were enacted; and
•	The anticipated revenues combined with the beginning cash balance of the general fund are insufficient to meet anticipated expenditures from this fund for the remainder of the current fiscal period.

     Accordingly, the governor ordered the allotment of each appropriation from the state general fund to be reduced effective October 1, 2010, by an amount necessary to avoid a cash deficit in the state general fund.

     Failure to amend the WCCC and SCC rules by October 1, 2010, will result in these programs becoming oversubscribed because of insufficient funds to pay program benefits, since the state will run out of funds for these programs in fiscal year 2011. The legislature's anticipated shortfall in the WorkFirst TANF box, combined with the governor's executive order making across-the-board revisions effective October 1, demonstrates that observing the time requirements of notice and opportunity to comment upon adoption of a permanent rule would be contrary both to the public interest and to the state's fiscal needs and requirements.

     Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 5, Repealed 0.

     Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0;      Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 5, Repealed 0.

     Date Adopted: September 24, 2010.

Elizabeth M. Hyde

Director

OTS-3586.2

AMENDATORY SECTION(Amending WSR 09-22-043, filed 10/28/09, effective 12/1/09)

WAC 170-290-0005   Consumers.   (1) In WCCC, an eligible consumer has parental control of one or more children, lives in the state of Washington, and is the child's:

     (a) Parent, either biological or adopted;

     (b) Stepparent;

     (c) Legal guardian verified by a legal or court document;

     (d) Adult sibling or step-sibling;

     (e) Nephew or niece;

     (f) Aunt;

     (g) Uncle;

     (h) Grandparent; or

     (i) Any of the relatives in (f), (g), or (h) of this subsection with the prefix great (for example, great-aunt).

     (2) Consumers may be eligible for WCCC benefits if they:

     (a) Meet eligibility requirements for WCCC described under part II of this chapter;

     (b) Participate in an approved activity under WAC 170-290-0040, 170-290-0045, 170-290-0050, or have been approved per WAC 170-290-0055;

     (c) Comply with any special circumstances that might affect WCCC eligibility under WAC 170-290-0020; and

     (d) Have countable income at or below ((two hundred percent of the federal poverty guidelines (FPG) (under WAC 170-290-0065))) one hundred seventy-five percent of the federal poverty guidelines.

     (3) A consumer is not eligible for WCCC benefits when he or she:

     (a) Is the only parent in the family and will be away from the home for more than thirty days in a row; or

     (b) Has a monthly copayment that is higher than the rate the state will pay for all eligible children in care.

[Statutory Authority: RCW 43.215.060, 43.215.070, 2006 c 265, and chapter 43.215 RCW. 09-22-043, § 170-290-0005, filed 10/28/09, effective 12/1/09. 08-08-047, recodified as § 170-290-0005, filed 3/27/08, effective 3/27/08. Statutory Authority: RCW 74.04.050, 74.12.340, 74.13.085, and 2003 1st sp.s. c 25. 04-08-021 and 04-08-134, § 388-290-0005, filed 3/29/04 and 4/7/04, effective 5/28/04. Statutory Authority: RCW 74.04.050 and C.F.R. Parts 98 and 99 (Child Care Development Fund Rules). 02-01-135, § 388-290-0005, filed 12/19/01, effective 1/19/02.]

     (a) Determine the consumer's family size (under WAC 170-290-0015); and

     (b) Determine the consumer's countable income (under WAC 170-290-0065).

     (2) If the consumer's family's countable monthly income falls within the range below, then his or her copayment is:

IF A CONSUMER'S INCOME IS:	THEN THE CONSUMER'S COPAYMENT IS:
(a) At or below 82% of the federal poverty guidelines (FPG)	$15
(b) Above 82% of the FPG up to 137.5% of the FPG	$50
(c) Above 137.5% of the FPG through ((200)) 175% of the FPG	The dollar amount equal to subtracting 137.5% of FPG from countable income, multiplying by 44%, then adding $50
(d) Above ((200)) 175% of the FPG, a consumer is not eligible for WCCC benefits.

     (3) DSHS does not prorate the copayment when a consumer uses care for part of a month.

     (4) The FPG is updated every year on April 1. The WCCC eligibility level is updated at the same time every year to remain current with the FPG.

[Statutory Authority: RCW 43.215.060, 43.215.070, 2006 c 265, and chapter 43.215 RCW. 09-22-043, § 170-290-0075, filed 10/28/09, effective 12/1/09. 08-08-047, recodified as § 170-290-0075, filed 3/27/08, effective 3/27/08. Statutory Authority: RCW 74.04.050, 74.12.340, 74.13.085, and 2003 1st sp.s. c 25. 04-08-021 and 04-08-134, § 388-290-0075, filed 3/29/04 and 4/7/04, effective 5/28/04. Statutory Authority: RCW 74.04.050, 74.13.085. 02-14-067, § 388-290-0075, filed 6/27/02, effective 8/1/02. Statutory Authority: RCW 74.04.050 and C.F.R. Parts 98 and 99 (Child Care Development Fund Rules). 02-01-135, § 388-290-0075, filed 12/19/01, effective 1/19/02.]

     (a) The consumer's monthly income decreases;

     (b) The consumer's family size increases;

     (c) DSHS makes an error in the consumer's copayment computation;

     (d) The consumer did not report all income, activity and household information at the time of eligibility determination or application/reapplication;

     (e) The consumer is no longer eligible for the minimum copayment under WAC 170-290-0090;

     (f) DEL makes a mass change in benefits due to a change in law or program funding;

     (g) The consumer is approved for a new eligibility period; or

     (h) The consumer is approved for the fourteen-day wait period or twenty-eight-day gap period as provided in WAC 170-290-0055.

     (2) If a consumer's copayment changes during his or her eligibility period, the change is effective on the first day of the month following DSHS becoming aware of the change.

     (3) DSHS does not increase a consumer's copayment during his or her current eligibility period when his or her countable income remains at or below ((two hundred percent of the FPG)) the maximum eligibility limit as provided in WAC 170-290-0005 (2)(d), and:

     (a) The consumer's monthly countable income increases; or

     (b) The consumer's family size decreases.

[Statutory Authority: RCW 43.215.060, 43.215.070, 2006 c 265, and chapter 43.215 RCW. 09-22-043, § 170-290-0085, filed 10/28/09, effective 12/1/09. 08-08-047, recodified as § 170-290-0085, filed 3/27/08, effective 3/27/08. Statutory Authority: RCW 74.04.050, 74.12.340, 74.13.085, and 2003 1st sp.s. c 25. 04-08-021 and 04-08-134, § 388-290-0085, filed 3/29/04 and 4/7/04, effective 5/28/04. Statutory Authority: RCW 74.04.050, 74.13.085. 02-14-067, § 388-290-0085, filed 6/27/02, effective 8/1/02. Statutory Authority: RCW 74.04.050 and C.F.R. Parts 98 and 99 (Child Care Development Fund Rules). 02-01-135, § 388-290-0085, filed 12/19/01, effective 1/19/02.]

     (a) Parent, either biological or adopted;

     (b) Stepparent;

     (c) Legal guardian as verified by a legal or court document;

     (d) Adult sibling or step-sibling;

     (e) Aunt;

     (f) Uncle;

     (g) Niece or nephew;

     (h) Grandparent; or

     (i) Any of the above relatives in (e), (f), or (h) of this subsection, with the prefix "great," such as great-aunt.

     (2) Consumers may be eligible for SCC benefits if they:

     (a) Meet eligibility requirements in this chapter;

     (b) Participate in an approved activity under WAC 170-290-3555; and

     (c) Have countable income at or below ((two hundred percent of the federal poverty guidelines (FPG))) the maximum eligibility limit described in WAC ((170-290-3640)) 170-290-0005 (2)(d).

     (3) Consumers are not eligible for SCC benefits if they:

     (a) Have a copayment, under WAC 170-290-0075, that is higher than the maximum monthly state rate for all of the consumer's children in care;

     (b) Were employed with one employer more than eleven months in the previous twelve months;

     (c) Are receiving TANF benefits; or

     (d) Are the only parent in the household and will be away from the home for more than thirty days in a row.

[Statutory Authority: RCW 43.215.060, 43.215.070, 2006 c 265, and chapter 43.215 RCW. 09-22-043, § 170-290-3520, filed 10/28/09, effective 12/1/09.]

     (a) The consumer's family size as defined under WAC 170-290-3540;

     (b) The consumer's average monthly income as calculated under WAC 170-290-3620;

     (c) The consumer's family's average monthly income as compared to the federal poverty guidelines (FPG); and

     (d) The consumer's family's average monthly income as compared to the copayment chart defined in WAC 170-290-0075.

     (2) If a consumer's family's income is above ((two hundred percent of the FPG as defined in WAC 170-290-0075)) the maximum eligibility limit as provided in WAC 170-290-0005 (2)(d), his or her family is not eligible for the SCC program.

     (3) SCC does not prorate the copayment when a consumer uses care for part of a month.

     (4) The FPG is updated every year on April 1. The SCC eligibility level is updated at the same time every year to remain current with the FPG.

     (5) SCC shall assign a copayment amount based on the family's countable income. The copayment amount will be on the consumer's child care plan. The consumer pays the copayment directly to the provider.

[Statutory Authority: RCW 43.215.060, 43.215.070, 2006 c 265, and chapter 43.215 RCW. 09-22-043, § 170-290-3640, filed 10/28/09, effective 12/1/09.]

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