Effective Date of Rule: Thirty-one days after filing.

     Purpose: The 2011 legislature adopted a series of spending reductions and revenue generating measures to help the state avoid a projected $5.1 billion budget deficit in the 2011-2013 biennium. Among the measures enacted, the legislature identified anticipated revenue of nearly $1 million in the biennium by directing the department of early learning (DEL) to raise annual license fees for child care center and family home child care licensees. See Appendix B in the 2011-13 Operating Budget Overview, 2ESHB 1087 published by the senate ways and means committee.

     Subsection 617(2) of ESHB [2ESHB] 1087 states: "(2) In accordance with RCW 43.215.255(2) and 43.135.055, the department is authorized to increase child care center and family home licensure fees in fiscal years 2012 and 2013 for costs to the department for the licensure activity, including costs of necessary inspection. These increases are necessary to support expenditures authorized in this section."

     The proposed rules raise the base license fee for DEL-licensed child care centers and school-age center programs by twenty-five percent. Centers also pay a per-child fee for each child above the first twelve children - these fees are raised by fifty percent. To summarize:

•	Base fee: Increased to $125 (previously $100) for the first twelve children in care; plus
•	Per child fee: Increased to $12 (previously $8) per child after the first twelve children, up to the center's maximum capacity stated on its license.

     Child care centers may be licensed for any number of children up to the safe capacity of the facility - some centers are licensed by DEL for more than two hundred fifty children.

     The new license fee rates for child care centers and school-age center programs has been in effect by emergency rule since July 1, 2011, see rules filed as WSR 11-13-077 and 11-21-021. This proposal is to adopt the new fee amounts as permanent rules.

     Family home child care licensees were increased by twenty-five percent to $30 (from the previous $24) in emergency rules filed as WSR 11-13-077 and 11-21-021, and in permanent rules filed as WSR 11-23-068 (effective March 31, 2012) implementing section 617(2) of 2ESHB 1087. This was the first increase for family home child care license fees since 1982. Family home providers do not pay a per-child fee.

     Proposal of this rule is consistent with state office of financial management guidance regarding implementation of Executive Order 10-06 suspending noncritical rule making (extended by Executive Order 11-03), but allowing rules to proceed that are: "... necessary to manage budget shortfalls, maintain fund solvency, or for revenue generating activities."

     The legislature stated in 2ESHB 1087 that the child care license fee increases are necessary to support the expenditures authorized in the bill. These license fees are deposited to the state general fund and are not retained by DEL.

•	Identifies the department's reasons for adopting the rule.
•	Describes any differences between the proposed rule and the final rule, other than editing, and the reasons for the differences; and
•	Summarizes all comments by category received on the proposal [proposed] rules during the official comment period, the department's response to the comments, and whether any comments resulted in a change to the final rules, or giving the department's reasons if the rule was not changed.

     The department sends the concise explanatory statement to everyone who commented on the proposed rules, or to anyone who requests it.

     Reasons for Adopting the Rule: The 2011 legislature adopted a series of spending reductions and revenue generating measures to help the state avoid a projected $5.1 billion budget deficit in the 2011-2013 biennium. Among the measures enacted, the legislature identified anticipated revenue of nearly $1 million in the biennium by directing DEL to raise annual license fees for child care center and family home child care licensees. See Appendix B in the 2011-13 Operating Budget Overview, 2ESHB 1087 published by the senate ways and means committee.

     Subsection 617(2) of ESHB [2ESHB] 1087 states: "(2) In accordance with RCW 43.215.255(2) and 43.135.055, the department is authorized to increase child care center and family home licensure fees in fiscal years 2012 and 2013 for costs to the department for the licensure activity, including costs of necessary inspection. These increases are necessary to support expenditures authorized in this section." The proposed rules raise the base license fee for DEL-licensed child care centers and school-age center programs by twenty-five percent. Centers also pay a per-child fee for each child above the first twelve children - these fees are raised by fifty percent. To summarize:

•	Base fee: Increased to $125 (previously $100) for the first twelve children in care; plus
•	Per child fee: Increased to $12 (previously $8) per child after the first twelve children, up to the center's maximum capacity stated on its license.

     Child care centers may be licensed for any number of children up to the safe capacity of the facility - some centers are licensed by DEL for more than two hundred fifty children.

     The new license fee rates for child care centers and school-age center programs has been in effect by emergency rule since July 1, 2011, see rules filed as WSR 11-13-077 and 11-21-021. This proposal is to adopt the new fee amounts as permanent rules.

     Family home child care licensees were increased by twenty-five percent to $30 (from the previous $24) in emergency rules filed as WSR 11-13-077 and 11-21-021, and in permanent rules filed as WSR 11-23-068 (effective March 31, 2012) implementing section 617(2) of 2ESHB 1087. This was the first increase for family home child care license fees since 1982. Family home providers do not pay a per-child fee.

     Proposal of this rule is consistent with state office of financial management guidance regarding implementation of Executive Order 10-06 suspending noncritical rule making (extended by Executive Order 11-03), but allowing rules to proceed that are: "... necessary to manage budget shortfalls, maintain fund solvency, or for revenue generating activities."

     The legislature stated in 2ESHB 1087 that the child care license fee increases are necessary to support the expenditures authorized in the bill. These license fees are deposited to the state general fund and are not retained by DEL.

     Rule Development Process: On May 31, 2011, DEL filed a CR-101 preproposal public notice that began the rule development process. In July 2011, DEL circulated a newsletter via e-mail and on-line informing the public about all of the bills that were passed by the 2011 legislature. Two written comments were received.

     On January 4, 2012, DEL filed the formal proposed rules (CR-102 notice). Formal public hearings were held in the evening on February 7, 2012, in Tumwater, and on Saturday, February 11, 2012 in Spokane. No one from the public attended the February 7 hearing. One person attended the Spokane hearing, and formal testimony was given by Laura Bowman, a licensed child care center director. The comments from the hearing and those received in writing are summarized by issue or WAC number in the table below. The table also includes the department responses to each issue raised in the public comments.

     Differences Between the Proposed Rule and the Final Rule, Other than Editing: No changes were made to the rules proposed as WSR 12-02-079.

     Summary of Comments; Department Response, and Effect on the Final Rule: DEL received both written and public hearing comments on the proposed rules. The following table summarized the issues raised in public comments and the department's response. The response also indicates if the proposed rule was changed as a result of the comment, or if the proposed rule was not changed and why.

Summary of Comments

Department Response Was the Proposed Rule Changed as a Result? If Not, Explain Why.

• For most centers, increasing any fees is a financial hardship especially with the economy and the huge increase to the minimum wages. I know in my area alone, four centers that have closed due to the financial hardships.      • The jump from $4.00 two years ago to the current proposed $12.00 is too high of an increase. Centers that serve middle and high income families will simply incorporate the fee increase into higher parent rates. But for centers serving a majority of low-income children on DSHS subsidies, there is no way to raise those state rates, which are already fifty percent of current market rates.      • I have a child care center and it is has been extremely difficult with the way the economy is to keep the doors open. We provide a quality environment and make very little money, if any at all. Even the littlest raise in fees would be extremely difficult at this time.

The final rule was not changed as a result of this comment. Rationale:      The 2011 legislature adopted a series of spending reductions and revenue generating measures to help the state avoid a projected $5.1 billion budget deficit in the 2011-2013 biennium. Among the measures enacted, the legislature identified anticipated revenue of nearly $1 million in the biennium by directing DEL to raise annual license fees for child care center and family home child care licensees. See Appendix B in the 2011-13 Operating Budget Overview, 2ESHB 1087 published by the senate ways and means committee.      Subsection 617(2) of ESHB [2ESHB] 1087 states: "(2) In accordance with RCW 43.215.255(2) and 43.135.055, the department is authorized to increase child care center and family home licensure fees in fiscal years 2012 and 2013 for costs to the department for the licensure activity, including costs of necessary inspection. These increases are necessary to support expenditures authorized in this section."

     Reasons Supporting Proposal: RCW 43.215.255 states, in part: "(1) The director shall charge fees to the licensee for obtaining a license ... (3) The director shall establish the fees charged by rule." DEL must adopt rules to set or revise fees for obtaining a child care license to comply with the proviso in section 617(2) of ESHB [2ESHB] 1087.

     Citation of Existing Rules Affected by this Order: Amending WAC 170-151-070 and 170-295-0060.

     Statutory Authority for Adoption: RCW 43.215.070 and 43.215.060, chapter 43.215 RCW.

      Adopted under notice filed as WSR 12-02-079 on January 4, 2012.

     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 2, 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 2, 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 2, Repealed 0.

     Date Adopted: April 11, 2012.

Elizabeth M. Hyde

Director

OTS-4038.1

AMENDATORY SECTION(Amending WSR 10-24-016, filed 11/19/10, effective 12/20/10)

WAC 170-151-070   How do I apply or reapply for a license?   (1) You must comply with the department's application procedures and submit to the department:

     (a) A completed department-supplied application for school-age child care center license, including attachments, ninety or more days before the:

     (i) Expiration of your current license;

     (ii) Opening date of your center;

     (iii) Relocation of your center; or

     (iv) Change of the licensee.

     (b) A completed background check form for each staff person or volunteer having unsupervised or regular access to the child in care; and

     (c) The annual licensing fee is:

     (i) ((For new licenses issued by the department before July 1, 2010, or for licensees whose annual licensing fees are due before July 1, 2010, forty-eight dollars per year for the first twelve children plus four dollars for each additional child over the licensed capacity of twelve children; or

     (ii))) For new licenses issued ((after June 30, 2010)) before July 1, 2011, or for licensees whose annual licensing fees are due ((after June 30, 2010)) before July 1, 2011, one hundred dollars per year for the first twelve children plus eight dollars for each additional child over the licensed capacity of twelve children; or

     (ii) For new licenses issued after June 30, 2011, or for licensees whose annual licensing fees are due after June 30, 2011, one hundred twenty-five dollars per year for the first twelve children, plus twelve dollars per year for each additional child over the licensed capacity of twelve children.

     (2) In addition to the required application materials specified under subsection (1) of this section, you must submit to the department:

     (a) An employment and education resume of the person responsible for the active management of the center and of the site coordinator;

     (b) Copies of diplomas or education transcripts of the director and site coordinator; and

     (c) Three professional references each for you, the director, and the site coordinator.

     (3) You, as the applicant for a license under this chapter must be twenty-one years of age or older.

     (4) You must conform to rules and regulations approved or adopted by the:

     (a) State department of health and relating to the health care of children at school-age child care centers;

     (b) State fire marshal's office, establishing standards for fire prevention and protection of life and property from fire, under chapter 212-12 WAC.

     (5) The department must not issue a license to you until the state fire marshal's office has certified or inspected and approved the center.

     (6) The department may exempt a school site possessing a fire safety certification signed by the local fire official within six months prior to licensure from the requirement to receive an additional fire safety inspection by the state fire marshal's office.

     (7) You must submit a completed plan of deficiency correction, when required, to the department of health and the department licensor before the department will issue you a license.

     (8) You, your director and site coordinator must attend department-provided orientation training.

[Statutory Authority: RCW 43.215.255, 43.215.070, chapter 43.215 RCW, 2010 c 37 § 614(14) 1st sp. sess. and RCW 43.135.055. 10-24-016, § 170-151-070, filed 11/19/10, effective 12/20/10. Statutory Authority: Chapter 43.215 RCW, RCW 43.43.832, 2006 c 265 and 2007 c 387. 08-10-041,§ 170-151-070, filed 4/30/08, effective 5/31/08. 06-15-075, recodified as § 170-151-070, filed 7/13/06, effective 7/13/06. Statutory Authority: RCW 74.15.020. 01-02-031, § 388-151-070, filed 12/22/00, effective 1/22/01. Statutory Authority: Chapter 74.15 RCW. 93-02-020 (Order 3493), § 388-151-070, filed 12/30/92, effective 1/30/93.]

OTS-4039.1

AMENDATORY SECTION(Amending WSR 10-24-016, filed 11/19/10, effective 12/20/10)

WAC 170-295-0060   What are the requirements for applying for a license to operate a child care center?   (1) To apply or reapply for a license to operate a child care center you must:

     (a) Be twenty-one years of age or older;

     (b) The applicant, director and program supervisor must attend the orientation programs that we provide, arrange or approve;

     (c) Submit to us a completed and signed application for a child care center license or certification using our forms (with required attachments).

     (2) The application package must include the following attachments:

     (a) The annual licensing fee. The fee is based on your licensed capacity, and is:

     (i) ((For new licenses issued by the department before July 1, 2010, or for licensees whose annual licensing fees are due before July 1, 2010, forty-eight dollars for the first twelve children plus four dollars for each additional child over the licensed capacity of twelve children; or

     (ii))) For new licenses issued ((after June 30, 2010)) before July 1, 2011, or for ((licenses)) licensees whose annual license fees are due ((after June 30, 2010)) before July 1, 2011, one hundred dollars per year for the first twelve children plus eight dollars for each additional child over the licensed capacity of twelve children; or

     (ii) For new licenses issued after June 30, 2011, or for licensees whose annual license fees are due after June 30, 2011, one hundred twenty-five dollars per year for the first twelve children, plus twelve dollars for each additional child over the licensed capacity of twelve children;

     (b) If the center is solely owned by you, a copy of your:

     (i) Photo identification issued by a government entity; and

     (ii) Social Security card that is valid for employment or verification of your employer identification number((.));

     (c) If the center is owned by a corporation, verification of the corporation's employer identification number;

     (d) An employment and education resume for:

     (i) The person responsible for the active management of the center; and

     (ii) The program supervisor((.));

     (e) Diploma or education transcript copies of the program supervisor;

     (f) Three professional references each, for yourself, the director, and the program supervisor;

     (g) Articles of incorporation if you choose to be incorporated;

     (h) List of staff (form is provided in the application);

     (i) Written parent communication (child care handbook);

     (j) Copy of transportation insurance policy (liability and medical);

     (k) In-service training program (for facilities employing more than five persons);

     (l) A floor plan of the facility drawn to scale;

     (m) A copy of your health care plan reviewed and signed by an advisory physician, physician's assistant, or registered nurse;

     (n) A copy of your policies and procedures that you give to parents; and

     (o) A copy of your occupancy permit.

     (3) You must submit to the department a completed background check form for all persons required to be authorized by DEL to care for or have unsupervised access to the children in care under chapter 170-06 WAC; and

     (4) You must submit your application and reapplication ninety or more calendar days before the date:

     (a) You expect to open your new center;

     (b) Your current license is scheduled to expire;

     (c) You expect to relocate your center;

     (d) You expect to change licensee; or

     (e) You expect a change in your license category.

[Statutory Authority: RCW 43.215.255, 43.215.070, chapter 43.215 RCW, 2010 c 37 § 614(14) 1st sp. sess. and RCW 43.135.055. 10-24-016, § 170-295-0060, filed 11/19/10, effective 12/20/10. Statutory Authority: Chapter 43.215 RCW, RCW 43.43.832, 2006 c 265 and 2007 c 387. 08-10-041, § 170-295-0060, filed 4/30/08, effective 5/31/08. 06-15-075, recodified as § 170-295-0060, filed 7/13/06, effective 7/13/06. Statutory Authority: Chapters 74.12 and 74.15 RCW. 04-09-093, § 388-295-0060, filed 4/20/04, effective 5/21/04; 03-14-110, § 388-295-0060, filed 6/30/03, effective 8/1/03.]

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