1.2relating to human services; forecasting the basic sliding fee child care assistance
1.3program; modifying child care assistance provider reimbursement rates;
1.4amending Minnesota Statutes 2012, sections 119B.02, subdivisions 1, 2;
1.5119B.03, subdivision 9; 119B.035, subdivisions 1, 4; 119B.05, subdivision
1.65; 119B.08, subdivision 3; 119B.09, subdivision 4a; 119B.231, subdivision
1.75; 256.017, subdivision 9; Minnesota Statutes 2013 Supplement, sections
1.8119B.011, subdivision 19b; 119B.05, subdivision 1; 119B.13, subdivision
1.91; repealing Minnesota Statutes 2012, sections 119B.011, subdivision 20a;
1.10119B.03, subdivisions 1, 2, 5, 6, 6a, 6b, 8; 119B.09, subdivision 3; Minnesota
1.11Statutes 2013 Supplement, section 119B.03, subdivision 4; Minnesota Rules,
1.12parts 3400.0020, subpart 8; 3400.0030; 3400.0060, subparts 2, 4, 6, 6a, 7.
1.13BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.14    Section 1. Minnesota Statutes 2013 Supplement, section 119B.011, subdivision 19b,
1.15is amended to read:
1.16    Subd. 19b. Student parent. "Student parent" means a person who is:
1.17(1) under 21 years of age and has a child;
1.18(2) pursuing a high school or general equivalency diploma; and
1.19(3) residing within a county that has a basic sliding fee waiting list under section
1.20119B.03, subdivision 4; and
1.21(4) (3) not an MFIP participant.

1.22    Sec. 2. Minnesota Statutes 2012, section 119B.02, subdivision 1, is amended to read:
1.23    Subdivision 1. Child care services. The commissioner shall develop standards
1.24for county and human services boards to provide child care services to enable eligible
1.25families to participate in employment, training, or education programs. Within the limits
1.26of available appropriations, The commissioner shall distribute money to counties to
2.1reduce the costs of child care for eligible families. The commissioner shall adopt rules to
2.2govern the program in accordance with this section. The rules must establish a sliding
2.3schedule of fees for parents receiving child care services. The rules shall provide that
2.4funds received as a lump-sum payment of child support arrearages shall not be counted
2.5as income to a family in the month received but shall be prorated over the 12 months
2.6following receipt and added to the family income during those months. The commissioner
2.7shall maximize the use of federal money under title I and title IV of Public Law 104-193,
2.8the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, and
2.9other programs that provide federal or state reimbursement for child care services for
2.10low-income families who are in education, training, job search, or other activities allowed
2.11under those programs. Money appropriated under this section must be coordinated with
2.12the programs that provide federal reimbursement for child care services to accomplish
2.13this purpose. Federal reimbursement obtained must be allocated to the county that spent
2.14money for child care that is federally reimbursable under programs that provide federal
2.15reimbursement for child care services. The counties commissioner shall use the federal
2.16money to expand child care services. The commissioner may adopt rules under chapter 14
2.17to implement and coordinate federal program requirements.

2.18    Sec. 3. Minnesota Statutes 2012, section 119B.02, subdivision 2, is amended to read:
2.19    Subd. 2. Contractual agreements with tribes. The commissioner may enter into
2.20contractual agreements with a federally recognized Indian tribe with a reservation in
2.21Minnesota to carry out the responsibilities of county human service agencies to the extent
2.22necessary for the tribe to operate child care assistance programs under sections 119B.03 and
2.23119B.05 . An agreement may allow for the tribe to be reimbursed for child care assistance
2.24services provided under section sections 119B.03 and 119B.05. The commissioner shall
2.25consult with the affected county or counties in the contractual agreement negotiations, if
2.26the county or counties wish to be included, in order to avoid the duplication of county
2.27and tribal child care services. Funding to support services under section 119B.03 may be
2.28transferred to the federally recognized Indian tribe with a reservation in Minnesota from
2.29allocations available to counties in which reservation boundaries lie. When funding is
2.30transferred under section 119B.03, the amount shall be commensurate to estimates of the
2.31proportion of reservation residents with characteristics identified in section 119B.03,
2.32subdivision 6 , to the total population of county residents with those same characteristics.

2.33    Sec. 4. Minnesota Statutes 2012, section 119B.03, subdivision 9, is amended to read:
3.1    Subd. 9. Portability pool. (a) The commissioner shall establish a pool of up to five
3.2percent of the annual appropriation for the basic sliding fee program to provide continuous
3.3child care assistance for eligible families who move between Minnesota counties. At the
3.4end of each allocation period, any unspent funds in the portability pool must be used for
3.5assistance under the basic sliding fee program. If expenditures from the portability pool
3.6exceed the amount of money available, the reallocation pool must be reduced to cover
3.7these shortages.
3.8(b) To be eligible for portable basic sliding fee assistance, a family that has moved
3.9from a county in which it (a) A family receiving child care assistance under the child care
3.10fund that has moved from a county in which the family was receiving basic sliding fee
3.11 child care assistance to a another county with a waiting list for the basic sliding fee program
3.12 must be admitted into the receiving county's child care assistance program if the family:
3.13(1) meet meets the income and eligibility guidelines for the basic sliding fee
3.14program; and
3.15(2) notify notifies the new county of residence within 60 days of moving and submit
3.16 submits information to the new county of residence to verify eligibility for the basic
3.17sliding fee program.
3.18(c) (b) The receiving county must:
3.19(1) accept administrative responsibility for applicants for portable basic sliding fee
3.20assistance at the end of the two months of assistance under the Unitary Residency Act;.
3.21(2) continue basic sliding fee assistance for the lesser of six months or until the
3.22family is able to receive assistance under the county's regular basic sliding program; and
3.23(3) notify the commissioner through the quarterly reporting process of any family
3.24that meets the criteria of the portable basic sliding fee assistance pool.

3.25    Sec. 5. Minnesota Statutes 2012, section 119B.035, subdivision 1, is amended to read:
3.26    Subdivision 1. Establishment. A family in which a parent provides care for the
3.27family's infant child may receive a subsidy in lieu of assistance if the family is eligible for
3.28or is receiving assistance under the basic sliding fee program. An eligible family must
3.29meet the eligibility factors under section 119B.09, except as provided in subdivision 4,
3.30and the requirements of this section. Subject to federal match and maintenance of effort
3.31requirements for the child care and development fund, and up to available appropriations,
3.32 the commissioner shall provide assistance under the at-home infant child care program
3.33and for administrative costs associated with the program. At the end of a fiscal year, the
3.34commissioner may carry forward any unspent funds under this section to the next fiscal
3.35year within the same biennium for assistance under the basic sliding fee program.

4.1    Sec. 6. Minnesota Statutes 2012, section 119B.035, subdivision 4, is amended to read:
4.2    Subd. 4. Assistance. (a) A family is limited to a lifetime total of 12 months of
4.3assistance under subdivision 2. The maximum rate of assistance is equal to 68 percent
4.4of the rate established under section 119B.13 for care of infants in licensed family child
4.5care in the applicant's county of residence.
4.6(b) A participating family must report income and other family changes as specified
4.7in the county's plan under section 119B.08, subdivision 3.
4.8(c) Persons who are admitted to the at-home infant child care program retain their
4.9position in any basic sliding fee program. Persons leaving the at-home infant child care
4.10program reenter the basic sliding fee program at the position they would have occupied.
4.11(d) Assistance under this section does not establish an employer-employee
4.12relationship between any member of the assisted family and the county or state.

4.13    Sec. 7. Minnesota Statutes 2013 Supplement, section 119B.05, subdivision 1, is
4.14amended to read:
4.15    Subdivision 1. Eligible participants. Families eligible for child care assistance
4.16under the MFIP child care program are:
4.17    (1) MFIP participants who are employed or in job search and meet the requirements
4.18of section 119B.10;
4.19    (2) persons who are members of transition year families under section 119B.011,
4.20subdivision 20 , and meet the requirements of section 119B.10;
4.21    (3) families who are participating in employment orientation or job search, or
4.22other employment or training activities that are included in an approved employability
4.23development plan under section 256J.95;
4.24    (4) MFIP families who are participating in work job search, job support,
4.25employment, or training activities as required in their employment plan, or in appeals,
4.26hearings, assessments, or orientations according to chapter 256J;
4.27    (5) MFIP families who are participating in social services activities under chapter
4.28256J as required in their employment plan approved according to chapter 256J;
4.29    (6) families who are participating in services or activities that are included in an
4.30approved family stabilization plan under section 256J.575;
4.31    (7) families who are participating in programs as required in tribal contracts under
4.32section 119B.02, subdivision 2, or 256.01, subdivision 2; and
4.33    (8) families who are participating in the transition year extension under section
4.34119B.011, subdivision 20a; and
4.35(9) (8) student parents as defined under section 119B.011, subdivision 19b.

5.1    Sec. 8. Minnesota Statutes 2012, section 119B.05, subdivision 5, is amended to read:
5.2    Subd. 5. Federal reimbursement. Counties and the state shall maximize their
5.3federal reimbursement under federal reimbursement programs for money spent for persons
5.4eligible under this chapter. The commissioner shall allocate any federal earnings to the
5.5county to be used to expand child care services under this chapter.

5.6    Sec. 9. Minnesota Statutes 2012, section 119B.08, subdivision 3, is amended to read:
5.7    Subd. 3. Child care fund plan. The county and designated administering agency
5.8shall submit a biennial child care fund plan to the commissioner. The commissioner shall
5.9establish the dates by which the county must submit the plans. The plan shall include:
5.10(1) a description of strategies to coordinate and maximize public and private
5.11community resources, including school districts, health care facilities, government
5.12agencies, neighborhood organizations, and other resources knowledgeable in early
5.13childhood development, in particular to coordinate child care assistance with existing
5.14community-based programs and service providers including child care resource and
5.15referral programs, early childhood family education, school readiness, Head Start, local
5.16interagency early intervention committees, special education services, early childhood
5.17screening, and other early childhood care and education services and programs to the extent
5.18possible, to foster collaboration among agencies and other community-based programs that
5.19provide flexible, family-focused services to families with young children and to facilitate
5.20transition into kindergarten. The county must describe a method by which to share
5.21information, responsibility, and accountability among service and program providers;
5.22(2) a description of procedures and methods to be used to make copies of the
5.23proposed state plan reasonably available to the public, including members of the public
5.24particularly interested in child care policies such as parents, child care providers, culturally
5.25specific service organizations, child care resource and referral programs, interagency
5.26early intervention committees, potential collaborative partners and agencies involved in
5.27the provision of care and education to young children, and allowing sufficient time for
5.28public review and comment; and
5.29(3) information as requested by the department to ensure compliance with the child
5.30care fund statutes and rules promulgated by the commissioner.
5.31The commissioner shall notify counties within 90 days of the date the plan is
5.32submitted whether the plan is approved or the corrections or information needed to approve
5.33the plan. The commissioner shall withhold a county's allocation until it has an approved
5.34plan. Plans not approved by the end of the second quarter after the plan is due may result
5.35in a 25 percent reduction in allocation. Plans not approved by the end of the third quarter
6.1after the plan is due may result in a 100 percent reduction in the allocation to the county
6.2 payments to a county until it has an approved plan. Counties are to maintain services despite
6.3any reduction in their allocation withholding of payments due to plans not being approved.

6.4    Sec. 10. Minnesota Statutes 2012, section 119B.09, subdivision 4a, is amended to read:
6.5    Subd. 4a. Temporary ineligibility of military personnel. Counties must reserve a
6.6family's position under the child care assistance fund if a family has been receiving child
6.7care assistance but is temporarily ineligible for assistance due to increased income from
6.8active military service. Activated military personnel may be temporarily ineligible until
6.9deactivation. A county must reserve a military family's position on the basic sliding fee
6.10waiting list under the child care assistance fund if a family is approved to receive child care
6.11assistance and reaches the top of the waiting list but is temporarily ineligible for assistance.

6.12    Sec. 11. Minnesota Statutes 2013 Supplement, section 119B.13, subdivision 1, is
6.13amended to read:
6.14    Subdivision 1. Subsidy restrictions. (a) Beginning February 3 July 1, 2014, the
6.15maximum rate paid for child care assistance in any county or county price cluster under
6.16the child care fund shall be the greater of the 25th 50th percentile of the 2011 most recent
6.17biennial child care provider rate survey under section 119B.02, subdivision 7, or the
6.18maximum rate effective November 28, 2011. The commissioner may: (1) assign a county
6.19with no reported provider prices to a similar price cluster; and (2) consider county level
6.20access when determining final price clusters.
6.21    (b) A rate which includes a special needs rate paid under subdivision 3 or under a
6.22school readiness service agreement paid under section 119B.231, may be in excess of the
6.23maximum rate allowed under this subdivision.
6.24    (c) The department shall monitor the effect of this paragraph on provider rates. The
6.25county shall pay the provider's full charges for every child in care up to the maximum
6.26established. The commissioner shall determine the maximum rate for each type of care
6.27on an hourly, full-day, and weekly basis, including special needs and disability care. The
6.28maximum payment to a provider for one day of care must not exceed the daily rate. The
6.29maximum payment to a provider for one week of care must not exceed the weekly rate.
6.30(d) Child care providers receiving reimbursement under this chapter must not be
6.31paid activity fees or an additional amount above the maximum rates for care provided
6.32during nonstandard hours for families receiving assistance.
7.1    (e) When the provider charge is greater than the maximum provider rate allowed,
7.2the parent is responsible for payment of the difference in the rates in addition to any
7.3family co-payment fee.
7.4    (f) All maximum provider rates changes shall be implemented on the Monday
7.5following the effective date of the maximum provider rate.
7.6    (g) Notwithstanding Minnesota Rules, part 3400.0130, subpart 7, maximum
7.7registration fees in effect on January 1, 2013, shall remain in effect.

7.8    Sec. 12. Minnesota Statutes 2012, section 119B.231, subdivision 5, is amended to read:
7.9    Subd. 5. Relationship to current law. (a) The following provisions in chapter 119B
7.10must be waived or modified for families receiving services under this section.
7.11    (b) Notwithstanding section 119B.13, subdivisions 1 and 1a, maximum weekly rates
7.12under this section are 125 percent of the existing maximum weekly rate for like-care.
7.13Providers eligible for a differential rate under section 119B.13, subdivision 3a, remain
7.14eligible for the differential above the rate identified in this section. Only care for children
7.15who have not yet entered kindergarten may be paid at the maximum rate under this
7.16section. The provider's charge for service provided through an SRSA may not exceed the
7.17rate that the provider charges a private-pay family for like-care arrangements.
7.18    (c) A family or child care provider may not be assessed an overpayment for care
7.19provided through an SRSA unless:
7.20    (1) there was an error in the amount of care authorized for the family; or
7.21    (2) the family or provider did not timely report a change as required under the law.
7.22    (d) Care provided through an SRSA is authorized on a weekly basis.
7.23    (e) Funds appropriated under this section to serve families eligible under section
7.24119B.03 are not allocated through the basic sliding fee formula under section 119B.03.
7.25 Funds appropriated under this section are used to offset increased costs when payments
7.26are made under SRSA's.
7.27    (f) Notwithstanding section 119B.09, subdivision 6, the maximum amount of child
7.28care assistance that may be authorized for a child receiving care through an SRSA in a
7.29two-week period is 160 hours per child.
7.30    (g) Effective May 23, 2008, absent day payment limits under section 119B.13,
7.31subdivision 7 , do not apply to children for care paid through SRSA's provided the family
7.32remains eligible under subdivision 3.

7.33    Sec. 13. Minnesota Statutes 2012, section 256.017, subdivision 9, is amended to read:
8.1    Subd. 9. Timing and disposition of penalty and case disallowance funds. Quality
8.2control case penalty and administrative penalty amounts shall be disallowed or withheld
8.3from the next regular reimbursement made to the county agency for state and federal
8.4benefit reimbursements and federal administrative reimbursements for all programs
8.5covered in this section, according to procedures established in statute, but shall not be
8.6imposed sooner than 30 calendar days from the date of written notice of such penalties.
8.7Except for penalties withheld under the child care assistance program, all penalties
8.8must be deposited in the county incentive fund provided in section 256.018. Penalties
8.9withheld under the child care assistance program shall be reallocated to counties using the
8.10allocation formula under section 119B.03, subdivision 5. All penalties must be imposed
8.11according to this provision until a decision is made regarding the status of a written
8.12exception. Penalties must be returned to county agencies when a review of a written
8.13exception results in a decision in their favor.

8.14    Sec. 14. DIRECTION TO COMMISSIONER OF MANAGEMENT AND
8.15BUDGET.
8.16The state obligation for the basic sliding fee child care assistance program under
8.17Minnesota Statutes, section 119B.03, must be included in the Minnesota Management
8.18and Budget February and November forecast of state revenues and expenditures under
8.19Minnesota Statutes, section 16A.103, beginning with the November 2014 forecast.

8.20    Sec. 15. REPEALER.
8.21Minnesota Statutes 2012, sections 119B.011, subdivision 20a; 119B.03, subdivisions
8.221, 2, 5, 6, 6a, 6b, and 8; and 119B.09, subdivision 3, are repealed.
8.23(b) Minnesota Statutes 2013 Supplement, section 119B.03, subdivision 4, is repealed.
8.24(c) Minnesota Rules, parts 3400.0020, subpart 8; 3400.0030; and 3400.0060,
8.25subparts 2, 4, 6, 6a, and 7, are repealed.