WSR 97-17-104

PROPOSED RULES

DEPARTMENT OF

SOCIAL AND HEALTH SERVICES

(Economic Services Administration)

(Public Assistance)

[Filed August 20, 1997, 10:38 a.m.]

Original Notice.

Preproposal statement of inquiry was filed as WSR 97-14-047.

Title of Rule: Chapter 388-290 WAC, Subsidized child care.

Purpose: On November 1, 1997, the four main Department of Social and Health Services-subsidized child care programs (JOBS, income assistance, transitional, and employment child care) will be consolidated into an "integrated" child care program. Phase-in will start November 1, 1997, and be complete by April 30, 1998. New rules will implement the mandate that all income and otherwise eligible TANF and non-TANF clients be eligible for the Department of Social and Health Services child care subsidies with a copayment.

Statutory Authority for Adoption: RCW 74.04.050, EHB 3901, sections 401 - 404, and chapter 58, Laws of 1997.

Statute Being Implemented: Sections 401 - 404, chapter 58, Laws of 1997; and Public Law 104-193, Sections 407 and 605.

Summary: The purpose of the subsidized child care program is to provide child care services necessary to assist low-income families with dependent children to become employed or maintain employment. Within available funds and guidelines, child care services will be provided on a sliding-fee scale basis based only on the amount of the family's income, not its source, whether that income is from employment, TANF assistance, both, or other income.

Reasons Supporting Proposal: State legislation.

Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Roger Long, Lacey Government Center, (360) 413-3256.

Name of Proponent: Department of Social and Health Services, governmental.

Rule is necessary because of federal law, [Public Law 104-193, Sections 407 and 605].

Explanation of Rule, its Purpose, and Anticipated Effects: The rule will implement the mandate that all income and otherwise eligible TANF and non-TANF clients be eligible for the Department of Social and Health Services child care subsidies with a copayment. See also Purpose and Summary above.

Proposal Changes the Following Existing Rules: Consolidates four existing Department of Social and Health Services-subsidized child care programs into a single, subsidized program.

No small business economic impact statement has been prepared under chapter 19.85 RCW. These rules do not negatively impact small businesses.

RCW 34.05.328 does not apply to this rule adoption. RCW 34.05.328 exempts the Department of Social and Health Services rules relating only to financial or medical eligibility.

Hearing Location: Lacey Government Center (behind Tokyo O'Bento restaurant), 1009 College Street S.E., Room 102, Lacey, WA 98503, on September 23, 1997, at 10:00 a.m.

Assistance for Persons with Disabilities: Contact Leslie Baldwin by September 15, 1997, phone (360) 902-7540, TTY (360) 902-8324, e-mail lbaldwin@dshs.wa.gov.

Submit Written Comments to and Identify WAC Numbers: Leslie Baldwin, Rules Coordinator, Rules and Policies Assistance Unit, P.O. Box 45850, Olympia, WA 98504-5850, FAX (360) 902-8292, by September 23, 1997.

Date of Intended Adoption: No sooner than September 24, 1997.

August 19, 1997

Merry A. Kogut, Manager

Rules and Policies Assistance Unit

SUBSIDIZED CHILD CARE

AMENDATORY SECTION (Amending Order 3916, filed 11/8/95, effective 12/9/95 WAC 388-290-010 Subsidized child care ((and other work-related supportive services))--Purpose. The purpose of this program is to provide child care ((and other support)) services necessary to assist families with dependent children to become ((self-sufficient)) employed or maintain employment. Within available funds and guidelines, child care services will be provided on a sliding-fee scale basis to families with gross incomes up to one hundred seventy-five percent of the Federal Poverty Level, based on the amount of the family's income, not its source, whether that income is from employment, temporary assistance for needy families (TANF) assistance, both, or other income.

[Statutory Authority: RCW 74.04.050 and 45 CFR 255.4(F). 95-23-028 (Order 3916), 388-290-010, filed 11/8/95, effective 12/9/95.]

AMENDATORY SECTION (Amending Order 3916, filed 11/8/95, effective 12/9/95 WAC 388-290-020 Subsidized child care--Definitions. Except as specified in this chapter, terms used under chapter 388-290 WAC shall have the same meaning applied to the ((AFDC)) WorkFirst and TANF program((, as terms defined under chapters 388-22 and 388-250 WAC, and to the JOBS program under chapter 388-47 WAC))s.

(((1))) "Able" means an adult who is physically ((and/or)), mentally and emotionally capable of caring for a child in a responsible manner.

(((2))) "Adjusted earned income" means the gross earned income minus the average payroll and income tax paid at that income level.

"Adult" for the purposes of this chapter, means an individual eighteen years of age or older.

"Applicable standards" means standards and practices related to child care under chapter 388-73 WAC ((or, in the case of a tribal JOBS program,)) (Child care agencies--Minimum licensing/certification requirements) or tribal law.

(((3))) "Available" means an adult able to provide child care due to not participating in an approved WorkFirst activity and/or employment during the time child care is required.

"Child care overpayment" means any child care payment received by or for an assistance unit for a month which exceeds the amount the unit was eligible to receive.

(((4))) "Child care provider" is a licensed, certified, or informal provider who provides child care for a child or children in an appropriate setting.

"Consumer" for the purposes of this chapter, means a parent or guardian who applies for, or receives subsidized child care services funded by the department.

"Co-payment" means the computed amount which is paid toward the child's cost of care.

(((5) "JOBS" means the job opportunities and basic skills training program for eligible AFDC families which assists obtaining education, training, and employment needed to avoid long-term welfare dependence.

(6) "Support services" means child care, and other services provided for under federal law, that may be required, enabling an AFDC applicant or recipient to pursue employment, education, and training under chapter 388-47 WAC JOBS training program.))

"Demonstrated inability to obtain needed child care" means one or more of the following:

(1) Unavailability of appropriate child care within a reasonable distance from the consumer's home or work site;

(2) Unavailability of appropriate licensed, certified, or informal child care arrangements.

"Informal provider" means an unlicensed child care provider who is:

(1) One of the following adult relatives in either the child's or relative's home:

(a) An adult sibling living outside the child's home; or

(b) A grandparent, aunt, uncle, first cousin, or great-grandparent, great-aunt, or great-uncle; and

(c) Not the child's biological, adoptive, or stepmother or stepfather.

(2) An adult friend or neighbor in the child's own home; or

(3) An adult extended tribal family member as defined under chapter 74.15 RCW (Care of children, expectant mothers, developmentally disabled).

"Self-employment income" is income from self-employment after deducting allowable business expenses from gross business income. Allowable business expenses are indicated in WAC 388-218-1350 (Allowable business expenses).

"Subsidy Unit" for the purposes of this chapter, means child care assistance unit and refers to two or more persons residing in the same household. A subsidy unit as defined in this chapter may or may not be the same as the TANF assistance unit, if any.

"Timely" for the purposes of this chapter, means within ten calendar days.

"Total income" for the purposes of this chapter, means the sum of adjusted earned income, self-employment income, and unearned income.

[Statutory Authority: RCW 74.04.050 and 45 CFR 255.4(F). 95-23-028 (Order 3916), 388-290-020, filed 11/8/95, effective 12/9/95.]

Reviser's note: The typographical error in the above section occurred in the copy filed by the agency and appears in the Register pursuant to the requirements of RCW 34.08.040.

Reviser's note: RCW 34.05.395 requires the use of underlining and deletion marks to indicate amendments to existing rules. The rule published above varies from its predecessor in certain respects not indicated by the use of these markings.

NEW SECTION

WAC 388-290-025 Determining the members of a subsidy unit. For the purposes of determining income eligibility and copayment calculation for subsidized child care, follow the guidelines below for determining subsidy unit size. Calculations refer to consumers who are either TANF or non-TANF, unless otherwise indicated.

(1) Subsidy units without a minor parent.

(a) Related adults (such as adult siblings), other than spouses, and their respective child(ren) residing together are each considered a separate subsidy unit.

(b) Unmarried parents with a mutual child(ren) living together are considered a single subsidy unit, unless one of the parents is a minor parent and receives TANF.

(c) Married or unmarried parents and their mutual and nonmutual children, if there is at least one mutual child, are considered a single subsidy unit, unless one of the parents is a minor parent and receives TANF.

(d) Unmarried adults without a mutual child(ren) are each considered a separate subsidy unit.

(e) A child (who is not a minor parent) and responsible relatives or responsible nonrelated persons are considered a single subsidy unit.

(f) A nonsibling child receiving TANF, eligible as a separate TANF assistance unit, is considered a separate subsidy unit.

(g) Only individuals residing in the same household are included in subsidy unit size, except for the military subsidy unit whose mother or father is on active duty overseas or out of state.

(2) Subsidy units with a minor parent.

(a) If the minor parent is part of a TANF grant including the parent(s) of the minor parent, all TANF recipients included in the TANF assistance unit of which the minor parent is a member shall be considered a single subsidy unit. Count only the subsidy unit's TANF income.

(b) A minor parent receiving TANF, eligible as a separate TANF assistance unit, is considered a separate subsidy unit.

(c) If the minor parent is the TANF head of household, the TANF assistance unit is considered a single subsidy unit. Count only the subsidy unit's TANF income.

(d) Unmarried minor parents with a mutual child(ren) living together are considered a single subsidy unit, unless the conditions in (c) of this subsection indicate otherwise.

(e) If the minor parent is non-TANF, and attending an approved secondary education or GED program, refer the minor parent to the teen parent child care program as indicated in WAC 388-15-170 (General and seasonal child care services).

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NEW SECTION

WAC 388-290-030 Responsibilities for the department, the consumer, and the provider under the subsidized child care program. (1) The department shall provide a program of subsidized child care for income-eligible consumers to participate in approved WorkFirst activities and/or employment as follows:

(a) Assure child care services meet applicable standards of state or tribal law;

(b) Not authorize payment to a child care provider unless parents or guardians are allowed access to their children whenever the children are in care;

(c) Take the child's individual needs into account when the department subsidizes or arranges for child care;

(d) Require that the parent or guardian provide sufficient documentation (such as written evidence) to the department that the informal provider of the parent or guardian's choice is in sufficient physical, emotional, and mental health to be a safe caretaker;

(e) Assure the parent or guardian's choice of child care or type of provider is not significantly restricted;

(f) Not authorize payment for child care for a subsidy unit where any adult in the subsidy unit is able and available to care for the children. See "able" and "available" as defined in WAC 388-290-020;

(g) Respond to request for subsidized child care within ten days;

(h) Inform consumers of the child care options for which the department can make payment;

(i) Inform consumers of the locations of community resources which can help them select child care, if needed;

(j) Inform consumers of their rights and responsibilities in relation to child care;

(k) Provide prompt child care payments to the provider; and

(l) Provide timely notice to consumers of reduction, suspension, or termination of child care benefits.

(2) Consumers shall:

(a) Be responsible to choose the provider and make the child care arrangements, including backup care arrangements;

(b) Notify the department of any change in providers within ten days;

(c) Pay the informal provider after the department pays the consumer for informal care;

(d) Pay any required co-payment. A consumer failing to pay, or make arrangements to pay, the required co-payment shall be subject to termination of subsidized child care benefits;

(e) Supply the department with necessary information to allow payment to the authorized provider;

(f) Notify the provider in a timely manner when the department discontinues or changes the child care authorization; and

(g) Provide notice to the department in a timely manner of any change in household size or income level that may affect the copayment amount.

(3) Providers shall meet the requirements in WAC 388-290-035 and 388-290-045.

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NEW SECTION

WAC 388-290-035 Providers eligible for payment under the subsidized child care program. (1) A licensed child care provider must be licensed as required by chapter 74.15 RCW and chapter 388-73, 388-155 (Minimum licensing requirements for family child day care homes), or 388-150 WAC (Minimum licensing requirements for child day care centers).

(2) Child care providers exempt from licensing but that must be certified by the department include:

(a) Tribal child care facilities meeting the requirements of tribal law;

(b) Child care facilities on a military installation;

(c) Child care facilities operated on public school property by a school district.

(3) Informal providers are exempt from licensing and certification, but must be registered with the department.

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NEW SECTION

WAC 388-290-045 Informal child care providers under subsidized child care program. (1) The department may subsidize informal care as long as the parent or guardian has assured the informal child care provider meets the following requirements:

(a) Be eighteen years of age or older;

(b) Be free of communicable diseases;

(c) Be of sufficient physical, emotional, and mental health to meet the needs of the child in care;

(d) Be able to care for the child without using corporal punishment or psychological abuse;

(e) Be able to accept and follow instructions;

(f) Be able to maintain personal cleanliness;

(g) Be prompt and regular in job attendance;

(h) Be registered with the department. Parents or guardians are required to give the provider's name, address, and valid social security number to the department. Registration is done at the time child care is authorized;

(i) Provide constant care and supervision of the child for whom the provider is responsible, during the time the provider is on duty, in accordance with the needs of the child; and

(j) Provide developmentally appropriate activities for the child under the provider's care.

(3) The department may subsidize informal care as long as the parent or guardian assures the following conditions are met:

(a) The home in which child care takes place must be safe for the child; and

(b) The child's immunizations must be current according to appropriate immunization schedules.

(4) The informal and family home child care provider must provide a valid social security number to the department.

(5) The department may terminate child care services, subject to timely notice requirements, if any or all of the conditions in this section are not met.

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NEW SECTION

WAC 388-290-050 Eligible children and consumers under the subsidized child care program. (1) To be eligible for subsidized child care, the consumer must:

(a) Be a legal citizen or qualified alien;

(b) Be income-eligible and employed, whether TANF or non-TANF;

(c) Be a TANF consumer who is participating in an approved WorkFirst activity(ies);

(d) Have physical or legal custody of one or more dependent children under the age of thirteen; and

(e) Not participate directly in the care of their own child(ren) during the time child care is authorized, if the consumer is an employee of the child care facility to which the department has authorized payment.

(2) The department may authorize subsidized child care for a child between thirteen and twenty years old if the child is:

(a) Physically, mentally or emotionally incapable of self-care, as verified by a licensed medical practitioner or masters-level or above mental health professional;

(b) Under court supervision.

(3) The department may authorize special needs child care for children twelve years of age or younger who meet the requirements in subsection (2)(a) of this section.

(4) The department may not authorize subsidized child care for children who are undocumented aliens.

(5) TANF consumers in sanction for noncooperation with the WorkFirst program or the division of child support (DCS) are not eligible for subsidized child care unless child care is necessary to:

(a) Obtain or maintain employment;

(b) Enroll in, or maintain enrollment in, an approved WorkFirst activity; or

(c) Remove the sanction.

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NEW SECTION

WAC 388-290-055 Payment for subsidized child care. (1) The department pays for subsidized child care based on:

(a) A consumer's hours of participation in an approved WorkFirst activity and/or hours of employment;

(b) Transportation time between the place of employment or approved WorkFirst activity and the child care provider's home or facility, if needed;

(c) The rates published by the department.

(2) The department may authorize child care payments for TANF consumers for up to two weeks for a consumer waiting to enter an approved WorkFirst activity, including employment.

(3) The department may authorize child care payments for TANF or non-TANF consumers for up to four weeks for a consumer who experiences a gap in employment, or approved WorkFirst activity, if all of the following conditions are met:

(a) The gap is for reasons out of the consumer's control, such as a medical emergency, lay-off, or school vacation;

(b) Employment, or the approved WorkFirst activity, is scheduled to resume within that period;

(c) The consumer has received subsidized child care during the period immediately preceding the gap in employment, or approved WorkFirst activity; and

(d) Child care arrangements would otherwise be lost.

(4) The department may pay for initial one-time fees for registration or equipment which are required by an authorized child care provider if such fees are:

(a) Required of all parents or guardians, subsidized and nonsubsidized, whose (child(ren) are in care with that provider; and

(b) Needed to maintain a child care arrangement.

(5) The department shall not pay ongoing annual registration fees unless the provider requires it of all parents or guardians.

(6) The department may pay regular, ongoing activity fees to the child care provider if the situation meets the requirements in subsection (4)(a) and (b) of this section.

(7) The department may establish a protective payee due to mismanagement of funds, if the TANF or non-TANF consumer fails to pay the informal child care provider, when:

(a) The department has issued a child care warrant to the correct address and twelve or more working days have passed since the issuance date; and

(b) The consumer has not reported the warrant lost, stolen, or destroyed.

(8) The child care co-payment is paid directly to the child care provider.

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NEW SECTION

WAC 388-290-060 Adequate notice requirements and effective dates under subsidized child care. (1) The department shall authorize subsidized child care payments for eligible consumers effective the following dates:

(a) For TANF consumers, the date an approved WorkFirst activity, including employment, begins, or the date of eligibility for assistance, whichever is later.

(b) For non-TANF consumers, the date employment begins, or the date of request for child care, whichever is later.

(2) If the TANF or non-TANF consumer does not report employment to the department timely, the effective date for child care benefits shall be the date of request for child care, or the date child care begins, whichever is later.

(3) All TANF consumers who require subsidized child care to participate in WorkFirst activities must locate a child care provider within ten days starting from the date of child care application. This rule applies unless the department determines the consumer has a demonstrated inability to obtain needed child care. See the definition of "demonstrated inability to obtain needed child care" in WAC 388-290-020.

(4) The department shall:

(a) Provide timely notice to consumers for changes in payment when the change results in a discontinuation, suspension, reduction, termination, or forces a change in child care arrangements;

(b) Terminate child care benefits to coincide with the termination of a WorkFirst activity, employment, or both, provided timely notice has been given.

(5) Timely notice requirements shall not apply for other changes in the manner of payment.

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NEW SECTION

WAC 388-290-070 Self-employment and subsidized child care. (1) To be and remain eligible for subsidized child care, a self-employed person must maintain and make available to the department a record which clearly documents all claimed business expenses and income.

(2) For the first twelve months of self-employment starting from the date the consumer first became eligible for child care for self-employment, the consumer's required hours of child care related to self-employment shall be based on the greater of the following:

(a) Written documentation of the number of hours worked, as verified and approved by the department; or

(b) The number of hours calculated by dividing the consumer's monthly self-employment income by the federal minimum wage.

(3) After the first twelve months, the consumer's necessary hours of child care shall be based on the lesser amounts in subsection (2)(a) or (b) of this section.

(4) The twelve-month period shall begin on the date the consumer becomes ineligible for TANF, or becomes eligible for subsidized child care, whichever is later.

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NEW SECTION

WAC 388-290-080 Subsidized child care--Fair hearings. (1) Consumers may request fair hearings under chapter 388-08 WAC (Practice and procedure--Fair hearing) on any action affecting child care benefits except for changes resulting from a change in policy or law.

(2) Consumers of subsidized child care may be eligible for continued child care benefits pending the outcome of a fair hearing if the consumer requests the fair hearing on or before the effective date of the action or within ten days of the notice of adverse action.

(3) The department shall consider any child care benefits the consumer receives pending a fair hearing or hearing decision to be an overpayment when/if the fair hearing decision subsequently finds against the consumer.

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NEW SECTION

WAC 388-290-090 Copayment rates under subsidized child care and when they must be calculated. (1) All consumers, whether TANF or non-TANF, shall contribute to the subsidized child care cost according to a sliding-fee scale based on the Federal Poverty Level (FPL) adjusted for family size.

(a) Subsidy units with total income at or below seventy-four percent of the FPL shall contribute ten dollars per month toward the subsidized child care cost;

(b) Subsidy units with total income between seventy-five and one hundred percent of the FPL shall contribute twenty dollars per month toward the subsidized child care cost;

(c) Subsidy units with total income between one hundred one and one hundred seventy-four percent of the FPL shall contribute either twenty dollars per month or forty-seven percent of their total income exceeding one hundred percent of the FPL, whichever is greater, toward the subsidized child care cost;

(d) Subsidy units whose total income equals or exceeds one hundred seventy-five percent of the FPL shall not be eligible for child care benefits subsidized by the department.

(2) The department shall calculate co-payments:

(a) At the time of the initial eligibility determination or authorization;

(b) At least every six months, starting from the first month of eligibility;

(c) When monthly income increases one hundred dollars or more;

(d) When monthly income decreases; or

(e) When subsidy unit size increases or decreases.

(3) If the subsidy unit's income fluctuates monthly, the department determines income eligibility and copayment amount on a monthly basis using the prior month's total income.

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NEW SECTION

WAC 388-290-100 Subsidized child care--Termination and reinstatement. (1) A subsidy unit becomes ineligible for subsidized child care when the consumer:

(a) Terminates WorkFirst activities;

(b) Fails to cooperate with the department in establishing and enforcing child support obligations;

(c) Terminates employment or self-employment;

(d) Has a child who is no longer dependent; or

(e) Fails to pay, or arrange payment for, required co-payment fees.

(2) The department shall only reinstate a subsidy unit's eligibility for subsidized child care when:

(a) The consumer who ceased participation in an approved WorkFirst activity, employment or self-employment, resumes participation;

(b) The consumer cooperates with the department in establishing and enforcing child support obligations;

(c) Back co-payment fees are paid or satisfactory arrangements are made to make full payments; or

(d) The consumer loses a job and finds another job.

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NEW SECTION

WAC 388-290-105 Subsidized child care--Overpayments. (1) In those areas not expressly covered under this section, child care consumers shall be subject to and covered by chapter 388-270 WAC (Incorrect payments).

(2) The department shall include, but not limit, a child care overpayment to:

(a) Vendor payments for child care provided during a period when a consumer was not eligible for subsidized child care;

(b) Payments made pending a fair hearing when the fair hearing decision subsequently finds against the consumer;

(c) Payments made during the ten-day advance notice period when the consumer is ineligible for payment;

(d) Continued payments received by the consumer because the appropriate ten-day advance period extends into the next month.

(3) The department shall calculate the amount of the child care overpayment based on the amount of child care payment the consumer or the child care provider receives for which the subsidy unit was not eligible.

(4) When establishing an overpayment, the department shall reduce any child care overpayment by the amount of any child care underpayment where applicable.

(5) The department shall recover overpayments from:

(a) The subsidy unit which was overpaid;

(b) Any subsidy unit of which a responsible member of the overpaid subsidy unit has subsequently become a member; or

(c) Any member of the overpaid subsidy unit whether or not currently a consumer.

(6) When a provider has received payment for child care services not provided, the department shall establish the overpayment in the provider's name.

(7) The department shall attempt recovery of an overpayment in all cases:

(a) Of fraud;

(b) Involving current consumers; and

(c) Where cost of recovery does not exceed the overpayment amount.

(8) In recovering overpayments from a current consumer, the department shall consider a subsidy unit's income level and financial obligations, including household expenses, when determining repayment requirements. Such subsidy units shall retain a reasonable amount of funds to meet their needs.

(9) The department may recover child care overpayments from current TANF or non-TANF consumers from their child care benefits. Recovery may not interfere with child care arrangements.

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REPEALER

The following sections of the Washington Administrative Code are repealed:

WAC 388-290-040 Assurances and responsibilities under JOBS, income assistance, and transitional child care.

WAC 388-290-110 JOBS, income assistance, and transitional child care programs.

WAC 388-290-115 JOBS, income assistance, and transitional child care programs--Eligible children and recipients.

WAC 388-290-120 JOBS, income assistance, and transitional child care program--Payment.

WAC 388-290-123 JOBS, income assistance, and transitional child care programs--Effective dates.

WAC 388-290-130 Income assistance and transitional child care programs--Effect on eligibility and payments.

WAC 388-290-135 JOBS, income assistance, and transitional child care--Hearings.

WAC 388-290-140 Income assistance child care program--Conversion.

WAC 388-290-155 Transitional child care--Purpose and initial eligibility.

WAC 388-290-160 Transitional child care--Co-payment.

WAC 388-290-170 Transitional child care--Ongoing eligibility.

WAC 388-290-180 Child care overpayments.

WAC 388-290-210 Other supportive services.

WAC 388-290-250 Transitional supportive services.