Paying child care providers fairly for their hard work and talent is a matter of respect for their essential role in shaping a brighter future for all of us.
The State committed to paying child care providers more fairly, based on the cost of care. California is now in the process of changing how and how much the State pays providers who deliver publicly funded child care services for families.
Read below to catch up on what’s happening with fair pay this state budget season.
The Legislature is concerned about the lack of progress and delayed timeline for fair pay:
The Joint Legislative Budget Committee sent a letter to the Department of Social Services (CDSS), the Department of Education (CDE), and the Department of Finance (DOF) sharing their concerns about the progress and timeline for fair pay, and asking for clarification by March 21st. Read the letter.
The Legislative Women’s Caucus (LWC) submitted a letter to Governor Newsom and the Legislative Budget Committees requesting that the state budget “secure a summer implementation of the new reimbursement structure to be based on the true cost of providing child care” and include a “specific date of enactment of the new reimbursement structure.” Read the letter.
At the Assembly Joint Budget Hearing for Subcommittees #2 and #3 in February, legislators shared that they are committed to implementing fair pay as soon as possible with Assemblymember Alvarez stating that “it’s time, this year we make good on a promise that was made” and Assemblymember Aguiar-Curry, representing the LWC, sharing that “I need some guarantees that we can get this done.”
Two staff consultants for the Assembly and Senate Budget Committees attended the Rate and Quality Advisory Panel (RQAP) meeting in March, highlighting legislators’ frustration that Governor Newsom did not include a fair pay proposal nor funding in the January State Budget Proposal. The Senate consultant shared that the Legislature has requested that the Governor’s Administration provide an implementation timeline by May 15th, rather than the July 1st deadline currently written in statute, because they are hearing from the Administration that the State will not begin paying providers based on the cost of care by July 1, 2025.
Legislators are interested in increasing pay for child care providers in this year’s state budget:
At the February Assembly Joint Budget Subcommittee Hearing, Assemblymember Jackson shared that the Legislature intends to develop a funding transition plan to increase provider payment rates until California is ready to implement fair pay based on the cost of care. Assemblymember Aguiar-Curry also highlighted that the LWC wants to see a commitment in this state budget, and every year, to increase child care providers’ pay as a recognition of their rising costs.
At the March RQAP meeting, the Assembly consultant also noted that legislators are interested in funding consistent pay increases for providers even if the State is not ready to implement its new fair pay policy on July 1, 2025.
CDSS shared new updates about 1) when the state may implement fair pay, 2) whether the Governor will include fair pay funding in the May Revise, and 3) next steps in the fair pay process for child care centers:
1) At the March RQAP meeting, CDSS shared that it will take longer than 6 months to fully automate fair pay in their systems, which means child care providers cannot be paid based on the cost of care starting July 1, 2025. CDSS also noted that if the state budget includes a temporary (“interim”) payment option that is less complex, CDSS could pay providers this temporary payment in 6 to 12 months (between January and June 2026).
2) At the same meeting, CDSS stated that Governor Newsom’s administration is currently “developing and working toward” a state budget proposal for fair pay, child care provider rates based on the cost of care. CDSS shared that Newsom’s administration “will include what’s necessary in the [State Budget] May Revision” and that it will depend on collective bargaining with Child Care Providers United for represented home-based providers and the state budget process for non-represented center-based providers.
3) At the February Assembly Joint Budget Subcommittee Hearing, CDSS shared that they are working with CDE to develop a draft proposal for the specific cost selection points (learn more here) that make up the actual cost of center-based care. At the March RQAP meeting, CDSS noted that this draft proposal would be shared with the Legislature and at a future RQAP meeting, but no date has yet been provided. Finally, CDSS noted that the RQAP may have a special convening before its regularly scheduled meeting on June 5th.
Fair pay means that child care providers who offer publicly funded care can cover 100% of their full costs for operating a sustainable business and take home a living wage, resulting in stability and growth for themselves and the children they care for. Learn more about fair pay on our website and check out our new fair pay one-pager.
The next state budget hearings on child care are April 3rd (Senate Budget Subcommittee #3) and April 23rd (Assembly Budget Subcommittees #2 & #3).
Paying child care providers fairly will make all our communities stronger.
