I
107TH CONGRESS
1ST SESSION
H. R. 3524
To amend the Child Care and Development Block Grant Act of 1990 to
provide access to early care and education so that families can work
and children can receive quality custodial care.
IN THE HOUSE OF REPRESENTATIVES
DECEMBER 19, 2001
Mr. GEORGE MILLER of California (for himself, Mr. ANDREWS, Mr. OWENS,
Mr. MORAN of Virginia, Mr. HINOJOSA, Ms. LEE, Mr. FRANK, Ms.
WOOLSEY, Mr. GREEN of Texas, Mr. KILDEE, Ms. MCCOLLUM, Mr.
ABERCROMBIE, Mr. MCGOVERN, Ms. DELAURO, Mr. NADLER, Mr.
BROWN of Ohio, Mr. STARK, and Mrs. MCCARTHY of New York) intro-
duced the following bill; which was referred to the Committee on Edu-
cation and the Workforce, and in addition to the Committee on Ways and
Means, for a period to be subsequently determined by the Speaker, in
each case for consideration of such provisions as fall within the jurisdic-
tion of the committee concerned
A BILL
To amend the Child Care and Development Block Grant
Act of 1990 to provide access to early care and education
so that families can work and children can receive quality
custodial care.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Child Development and Family Employment Act of
2002’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
TITLE I—CHILD CARE SUBSIDIES DEVELOPMENT FUND
Sec. 101. Purpose and goals.
Sec. 102. Authorization of appropriations.
Sec. 103. State plan requirements.
Sec. 104. Payment rates.
Sec. 105. Child care accountability improvements.
Sec. 106. Incentive grants to States.
Sec. 107. Administration and enforcement.
Sec. 108. Reports.
Sec. 109. Amounts reserved.
Sec. 110. Definitions.
Sec. 111. Conforming amendments.
TITLE II—CHILD CARE QUALITY IMPROVEMENT
Sec. 201. Short title.
Sec. 202. Findings and purpose.
Sec. 203. Definitions.
Sec. 204. Funds for child care provider development and retention grants and
for child care provider scholarships.
Sec. 205. Allotments to States.
Sec. 206. Application and plan.
Sec. 207. Child care provider development and retention grant program.
Sec. 208. Child care provider scholarship program.
Sec. 209. Annual report.
Sec. 210. Authorization of appropriations.
TITLE I—CHILD CARE SUBSIDIES
DEVELOPMENT FUND
SEC. 101. PURPOSE AND GOALS.
(a) PURPOSE
AND GOALS.—Section 658A of the
Child Care and Development Block Grant Act of 1990 (42
U.S.C. 9801 note) is amended—
(1) in the heading by striking ‘‘AND GOALS’’
and inserting ‘‘, PURPOSE, AND GOALS’’;
(2) in subsection (b)—
(A) in subparagraph (4) by striking ‘‘and’’
at the end;
(B) in subparagraph (5) by striking the
period at the end and inserting ‘‘; and’’; and
(C) by adding the end the following:
‘‘(6) to assist States to provide access to high
quality child care that promotes early learning and
facilitates school readiness.’’; and
(D) by redesignating such subsection as
subsection (c); and
(3) by inserting after subsection (a) the fol-
lowing:
‘‘(b) STATEMENT OF PURPOSE.—It is the purpose of
this subchapter to provide low-income families access to
safe, quality child care so that families can work and
young children can receive the high quality early care and
learning they need to start school ready to learn and
school-age children can receive after-school care and en-
richment.’’.
SEC. 102. AUTHORIZATION OF APPROPRIATIONS.
(a) CHILD CARE AND DEVELOPMENT BLOCK GRANT
ACT OF 1990.—Section 658B of the Child Care and De-
velopment Block Grant Act of 1990 (42 U.S.C. 9858) is
amended to read as follows:
‘‘SEC. 
658B. 
AUTHORIZATION 
OF 
APPROPRIATIONS;
AMOUNTS 
AVAILABLE 
FOR 
INCENTIVE
GRANTS TO IMPROVE QUALITY OF CHILD
CARE SERVICES.
‘‘(a) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated to carry out this
subchapter—
‘‘(1) $4,000,000,000 for each of the fiscal year
2003;
‘‘(2) $5,000,000,000 for each of the fiscal year
2004;
‘‘(3) $6,000,000,000 for each of the fiscal year
2005;
‘‘(4) $7,000,000,000 for each of the fiscal year
2006; and
‘‘(5) $8,000,000,000 for each of the fiscal year
2007.
‘‘(b) AMOUNTS AVAILABLE FOR INCENTIVE GRANTS
TO IMPROVE QUALITY OF CHILD CARE SERVICES.—Of
the amounts made available under section 418(c)(2) of the
Social Security Act (42 U.S.C. 618(c)(2)) to carry out ac-
tivities under this subchapter—
‘‘(1) $500,000,000 for fiscal year 2003;
‘‘(2) $500,000,000 for fiscal year 2004;
‘‘(3) $500,000,000 for fiscal year 2005;
‘‘(4) $750,000,000 for fiscal year 2006; and
‘‘(5) $750,000,000 for fiscal year 2007;
shall be used to make grants under section 658H after
reserving the amounts required by section 658O(a)(3).’’.
(b) SOCIAL SECURITY ACT.—Section 418 of the So-
cial Security Act (42 U.S.C. 618) is amended—
(1) in subsection (a)—
(A) in paragraph (1) by inserting ‘‘and
subsection (c)(2)’’ after ‘‘paragraph (3)’’; and
(B) in paragraph (3) by striking subpara-
graphs (A) through (F) and inserting the fol-
lowing:
‘‘(A) $4,217,000,000 for fiscal year 2003;
‘‘(B) $5,317,000,000 for fiscal year 2004;
‘‘(C) $6,417,000,000 for fiscal year 2005;
‘‘(D) $7,517,000,000 for fiscal year 2006;
and
‘‘(E) 
$8,617,000,000 
for 
fiscal 
year
2007.’’; and
(2) in subsection (c)—
(A) by inserting ‘‘(1)’’ before ‘‘Notwith-
standing’’;
(B) by inserting ‘‘and except as provided
in paragraph (2)’’ after ‘‘law’’; and
(C) by adding at the end the following:
‘‘(2) Notwithstanding any other provision of law,
from the amounts appropriated under subsection (a)(3)
for fiscal years 2003 through 2007, the Secretary shall
carry out section 658B(b) of the Child Care and Develop-
ment Block Grant Act of 1990 (42 U.S.C. 9858(b)).’’.
SEC. 103. STATE PLAN REQUIREMENTS.
Section 658E(c)(2) of the Child Care and Develop-
ment Block Grant Act of 1990 (42 U.S.C. 9858c(c)(2))
is amended—
(1) in subparagraph (A)—
(A) in clause (ii) by striking ‘‘and’’ at the
end;
(B) in clause (iii) by adding ‘‘and’’ at the
end; and
(C) by inserting after clause (iii) the fol-
lowing:
‘‘(iv) in order to help ensure that par-
ents have the freedom to choose quality
center-based child care services, the State
shall make significant effort to develop
contracts with accredited child care pro-
viders in low-income and rural commu-
nities;’’;
(2) by amending subparagraph (D) to read as
follows:
‘‘(D) CONSUMER
EDUCATION
INFORMA-
TION.—Certify that the State will collect and
disseminate to parents of eligible children and
the general public, consumer education informa-
tion that will promote informed child care
choices, and describe how the State will inform
parents receiving assistance under a State pro-
gram funded under part A of title IV of the So-
cial Security Act (42 U.S.C. 601 et seq.) and
other low-income parents about eligibility for
assistance under this subchapter.’’;
(3) by amending subparagraph (H) to read as
follows:
‘‘(H) MEETING THE NEEDS OF CERTAIN
POPULATIONS.—Demonstrate the manner in
which the State will meet the specific child care
needs of families who are receiving assistance
under a State program under part A of title IV
of the Social Security Act, families who are at-
tempting through work activities to transition
off of such assistance program, families with
children with special needs, low-income families
not receiving cash assistance under a State pro-
gram under part A of title IV of the Social Se-
curity Act, and families that are at risk of be-
coming dependent on such assistance.’’; and
(4) by adding at the end the following:
‘‘(I) AVAILABILITY
OF
STAFF.—Describe
how the State will ensure that staff from the
lead agency described in section 658D will be
available, at the offices of the State program
funded under part A of title IV of the Social
Security Act, to provide information about eligi-
bility for assistance under this subchapter and
to assist individuals in applying for such assist-
ance.
‘‘(J) ELIGIBILITY
REDETERMINATION.—
Demonstrate that each child that receives as-
sistance under this subchapter in the State will
receive such assistance for not less than 1 year
before the State redetermines the eligibility of
the child under this subchapter.
‘‘(K) ESTABLISHMENT OF TRAINING RE-
QUIREMENTS.—Certify that there are training
requirements in effect within the State, under
State or local law, that are designed to support
the learning and development of children and
that are applicable to all child care providers
that provide services for which assistance is
made available under this subchapter. Such re-
quirements shall include requirements relating
to preservice training in childhood development.
Such training shall be relevant to the ages of
the children for whom such provider delivers
care.
‘‘(i) For States that do not presently
require preservice training in child develop-
ment meeting the requirements specified in
this subparagraph—
‘‘(I) the State shall submit as
part of its plan, how it will ensure
that this subparagraph is imple-
mented not later than 1 year after the
date of the enactment of Child Devel-
opment and Family Employment Act
of 2002; and
‘‘(II) the State may elect for a
child care provider who is not required
to be registered, licensed, or regulated
but who must comply with section
658E(c)(F), 
to 
consider 
inservice
training in child development that is
completed not later than 60 days after
a child’s first day of enrollment with
such provider, as compliance with this
subparagraph.
‘‘(ii) Nothing in clause (i) shall be
considered to preempt or supersede any
State or local law that requires child care
providers to have preservice training in
child development.
‘‘(L) INSURING
THE
SAFETY
OF
CHIL-
DREN.—Certify that there are requirements in
effect within the State, under State or local
law, that require that evaluators from an appro-
priate State or local agency make not less than
2 unannounced visits annually to each child
care provider in the State that provides services
for which assistance is made available under
this subchapter. A State may elect to exempt
from this subparagraph child care providers
who are not required to be licensed or regulated
but who are required to comply with subpara-
graph (F).
‘‘(M) SUPPLEMENT NOT SUPPLANT.—Pro-
vide assurances that the amounts paid to a
increases in the cost of living, in such
manner as the Secretary may specify.
‘‘(iii) Payment rates shall reflect vari-
ations in the cost of providing child care
services for children of different ages and
providing different types of care.’’.
SEC. 105. CHILD CARE ACCOUNTABILITY IMPROVEMENTS.
Section 658G of the Child Care and Development
Block Grant Act of 1990 (42 U.S.C. 9858e) is amended—
(1) by amending the heading to read as follows:
‘‘SEC. 658G. CHILD CARE ACCOUNTABILITY IMPROVE-
MENTS.’’,
(2) by amending the matter following the sec-
tion heading to read as follows:
‘‘(a) ACTIVITIES TO IMPROVE
THE QUALITY
OF
CHILD CARE.—
‘‘(1) IN GENERAL.—A State that receives funds
to carry out this subchapter shall reserve and use
not less than 16 percent of the funds for improve-
ments in the quality of child care services provided
in the State and in political subdivisions of the
State.
‘‘(A) Not less than 35 percent of the funds
reserved under this paragraph shall be used for
activities that are designed to increase the qual-
ity and supply of child care services for children
from birth through 3 years of age.
‘‘(B) Funds reserved under this paragraph
shall be used for 1 or more activities consisting
of—
‘‘(i) providing directly, or providing fi-
nancial assistance to private nonprofit or-
ganizations or public entities (including
units of general purpose local government)
for the development, establishment, expan-
sion, operation, and coordination of, child
care resource and referral services;
‘‘(ii) making grants or providing loans
to eligible child care providers to assist the
providers in meeting applicable State and
local child care standards and recognized
accreditation standards;
‘‘(iii) improving the ability of State or
local government, as applicable, to monitor
compliance with, and to enforce, State and
local licensing and regulatory requirements
(including registration requirements) appli-
cable to child care providers;
‘‘(iv) providing training and technical
assistance in areas relating to the provision
of child care services, such as training re-
lating to promotion of health and safety,
promotion of good nutrition, provision of
first aid, recognition of communicable dis-
eases, child abuse detection and preven-
tion, and care of children with special
needs;
‘‘(v) improving salaries and other
compensation paid to full-time and part-
time staff who provide child care services
for which assistance is made available
under this subchapter;
‘‘(vi) making grants or providing fi-
nancial assistance to eligible child care pro-
viders for training in child development
and early education;
‘‘(vii) making grants or providing fi-
nancial assistance to eligible child care pro-
viders to support delivery of early edu-
cation and child development activities;
‘‘(viii) making grants or providing fi-
nancial assistance to eligible child care pro-
viders to make minor renovations to such
providers’ physical environments that en-
hance the quality of the child care services
they provide;
‘‘(ix) improving and expanding the
supply of child care services for children
with special needs;
‘‘(x) supporting the system described
in paragraph (2); and
‘‘(xi) other activities that can be dem-
onstrated to increase the quality of child
care services and parental choice.
‘‘(2) CHILD CARE RESOURCE AND REFERRAL
SYSTEM.—The State shall use a portion of the funds
reserved under paragraph (1) to support a system of
local child care resource and referral organizations
coordinated by a statewide-led child care resource
and referral organization. The local child care re-
source and referral organizations shall—
‘‘(A) provide parents in the State with in-
formation and support concerning child care op-
tions in their communities;
‘‘(B) collect data on the supply of and de-
mand for child care in political subdivisions
within the State;
‘‘(C) develop links with the business com-
munity or other organizations involved in pro-
viding child care services;
‘‘(D) increase the supply and improve the
quality of child care in the State and in political
subdivisions in the State;
‘‘(E) hire specialists in health, mental
health, early literacy, special needs, and infant
and toddler care to support or supplement com-
munity child care providers; or
‘‘(F) provide training or facilitate connec-
tions for training to community child care pro-
viders.’’.
SEC. 106. INCENTIVE GRANTS TO STATES.
The Child Care and Development Block Grant Act
of 1990 (42 U.S.C. 9858 et seq.) is amended by inserting
after section 658G the following:
‘‘SEC. 658H. INCENTIVE GRANTS TO STATES.
‘‘(a) AUTHORITY.—
‘‘(1) IN GENERAL.—The Secretary shall use the
amount made available under section 658B(b) for a
fiscal year to make grants to eligible States in ac-
cordance with this section.
‘‘(2) ANNUAL PAYMENTS.—The Secretary shall
make an annual payment for such a grant to each
eligible State out of the allotment for that State de-
termined under subsection (c).
‘‘(b) ELIGIBLE STATES.—
‘‘(1) IN GENERAL.—In this section, the term
‘eligible State’ means a State that—
‘‘(A) has conducted a survey of the market
rates for child care services in the State within
the 2 years preceding the date of the submis-
sion of an application under paragraph (2); and
‘‘(B) submits an application in accordance
with paragraph (2).
‘‘(2) APPLICATION.—
‘‘(A) IN GENERAL.—To be eligible to re-
ceive a grant under this section, a State shall
submit an application to the Secretary at such
time, in such manner, and accompanied by such
information, in addition to the information re-
quired under subparagraph (B), as the Sec-
retary may require.
‘‘(B) INFORMATION REQUIRED.—Each ap-
plication submitted for a grant under this sec-
tion shall—
‘‘(i) detail the methodology and re-
sults of the State market rates survey con-
ducted pursuant to paragraph (1)(A);
‘‘(ii) describe the State’s plan to in-
crease payment rates from the initial base-
line determined under clause (i);
‘‘(iii) describe how the State will in-
crease payment rates in accordance with
the market survey results, for all types of
child care providers who provide services
for which assistance is made available
under this subchapter;
‘‘(iv) describe how rates are set to re-
flect the variations in the cost of providing
care for children of different ages and dif-
ferent types of care; and
‘‘(v) describe how the State will
prioritize increasing payment rates for care
of higher-than-average quality, such as
care by accredited providers, care that in-
cludes the provision of comprehensive serv-
ices, care provided at nonstandard hours,
care for children with special needs, care in
low-income and rural communities, and
care of a type that is in short supply.
‘‘(3) 
CONTINUING
ELIGIBILITY
REQUIRE-
MENT.—The Secretary may make an annual pay-
ment under this section to an eligible State only if—
‘‘(A) the Secretary determines that the
State has made progress, through the activities
assisted under this subchapter, in maintaining
increased payment rates; and
‘‘(B) at least once every 2 years, the State
conducts an update of the survey described in
paragraph (1)(A).
‘‘(4) REQUIREMENT OF MATCHING FUNDS.—
‘‘(A) IN GENERAL.—To be eligible to re-
ceive a grant under this section, the State shall
agree to make available State contributions
from State sources toward the costs of the ac-
tivities to be carried out by a State pursuant to
subsection (d) in an amount that is not less
than 20 percent of such costs.
‘‘(B) DETERMINATION
OF
STATE
CON-
TRIBUTIONS.—State contributions shall be in
cash. Amounts provided by the Federal Govern-
ment may not be included in determining the
amount of such State contributions.
‘‘(c) ALLOTMENTS
TO
ELIGIBLE
STATES.—The
amount made available under section 658B(b) for a fiscal
year shall be allotted among the eligible States in the same
manner as amounts are allotted under section 658O(b).
‘‘(d) USE OF FUNDS.—An eligible State that receives
a grant under this section shall use the funds received to
significantly increase the payment rate for the provision
of child care assistance in accordance with this subchapter
up to the 150th percentile of the market rate survey de-
scribed in subsection (b)(1)(A).
‘‘(e) EVALUATIONS AND REPORTS.—
‘‘(1) STATE EVALUATIONS.—Each eligible State
shall submit to the Secretary, at such time and in
such form and manner as the Secretary may require,
information regarding the State’s efforts to increase
payment rates and the impact increased rates are
having on the quality of, and accessibility to, child
care in the State.
‘‘(2) REPORTS TO CONGRESS.—The Secretary
shall submit biennial reports to Congress on the in-
formation described in paragraph (1). Such reports
shall include data from the applications submitted
under subsection (b)(2) as a baseline for deter-
mining the progress of each eligible State in main-
taining increased payment rates.
‘‘(f) PAYMENT RATE.—In this section, the term ‘pay-
ment rate’ means the rate of reimbursement to providers
for subsidized child care.’’.
SEC. 107. ADMINISTRATION, ENFORCEMENT, AND EVALUA-
TION.
Section 658I of the Child Care and Development
Block Grant Act of 1990 (42 U.S.C. 9858g) is amended—
(1) in the heading by striking ‘‘AND
EN-
FORCEMENT’’ and inserting ‘‘, ENFORCEMENT,
AND EVALUATION’’;
(2) in subsection (a)(3) by inserting before the
period at the end ‘‘and including the establishment
of a national training and technical assistance center
specializing in infant and toddler care and their fam-
ilies’’; and
(3) by adding at the end the following:
‘‘(c) FEDERAL ADMINISTRATION AND EVALUATION
ACTIVITIES.—The Secretary shall—
‘‘(1) establish a national data system through
grants, contracts or cooperative agreements to de-
velop statistics on the supply of, demand for, and
quality of child care, early education, and non-
school-hours programs, including use of data col-
lected through child care resource and referral orga-
nizations at the national, State, and local levels; and
‘‘(2) prepare and submit to Congress an annual
report on the supply of, demand for, and quality of
child care, early education, and non-school-hours
programs, using data collected through State and
local child care resource and referral organizations
and other sources.’’.
SEC. 108. REPORTS.
Section 658K(a) of the Child Care and Development
Block Grant Act of 1990 (42 U.S.C. 9858i(a)) is
amended—
(1) in paragraph (1)(B)—
(A) in clause (ix) by striking ‘‘and’’ at the
end;
(B) in clause (x) by adding ‘‘and’’ at the
end; and
(C) by inserting after clause (x) the fol-
lowing:
‘‘(xi) whether the child care provider
is accredited by a national or State accred-
iting body;’’; and
(2) in paragraph (2)—
(A) in the matter preceding subparagraph
(A) by striking ‘‘aggregate data concerning’’;
(B) in subparagraph (D) by striking ‘‘and’’
at the end;
(C) in subparagraph (E) by adding ‘‘and’’
at the end; and
(D) by indenting the left margin of sub-
paragraphs (A) through (E) 2 ems to the right
and redesignating such subparagraphs as
clauses (i) through (v), respectively;
(E) by inserting after clause (v), as so re-
designated, the following:
‘‘(vi) findings from market rate sur-
veys, disaggregated by the types of services
provided and by the sub-State localities, as
appropriate;’’; and
(F) by inserting before clause (i), as so re-
designated, the following:
‘‘(A) information on how all of the funds
reserved under section 658G were allocated and
spent, and information on the effect of those
expenditures, to the maximum extent prac-
ticable; and
‘‘(B) aggregate date concerning—’’.
SEC. 109. AMOUNTS RESERVED.
Section 658O(a) of the Child Care and Development
Block Grant Act of 1990 (42 U.S.C. 9858m(a)) is amend-
ed by adding at the end the following:
‘‘(3) ADMINISTRATION.—The Secretary shall
reserve not more than 2 percent of the amount made
available to carry out this subchapter (including the
amount made available under section 418(c)(2) of
the Social Security Act) for each fiscal year to carry
out section 658I.’’.
SEC. 110. DEFINITIONS.
Section 658P(4)(C) of the Child Care and Develop-
ment Block Grant Act of 1990 (42 U.S.C. 9858n(4)(C))
is amended—
(1) in clause (i) by striking ‘‘or’’ at the end;
(2) in clause (ii) by striking the period and in-
serting ‘‘; or’’; and
(3) by adding at the end the following:
‘‘(iii) is a foster child.’’.
SEC. 111. CONFORMING AMENDMENTS.
The Child Care and Development Block Grant Act
of 1990 (42 U.S.C. 9858 et seq.) is amended—
(1) in section 658E(c)(3)—
(A) in subparagraph (B) by striking
‘‘through (5) of section 658A(b)’’ and inserting
‘‘through (6) of section 658A(c)’’; and
(B) in subparagraph (D) by striking
‘‘1997 through 2002’’ and inserting ‘‘2003
through 2007’’;
(2) in section 658K(a)(2) by striking ‘‘1997’’
and inserting ‘‘2003’’; and
(3) in section 658L—
(A) by striking ‘‘July 31, 1998’’ and in-
serting ‘‘October 1, 2004’’;
(B) by striking ‘‘Economic and Edu-
cational Opportunities’’ and inserting ‘‘Edu-
cation and the Workforce’’; and
(C) by striking ‘‘Labor and Human Re-
sources’’ and inserting ‘‘Health, Education,
Labor, and Pensions’’.
TITLE II—CHILD CARE QUALITY
IMPROVEMENT
SEC. 201. SHORT TITLE.
This title may be cited as the ‘‘Focus On Committed
and Underpaid Staff for Children’s Sake Act’’ or as the
‘‘FOCUS Act’’.
SEC. 202. FINDINGS AND PURPOSE.
(a) FINDINGS.—Congress makes the following find-
ings:
(1) Research on early brain development and
early childhood demonstrates that the experiences
children have and the attachments children form
early in life have a decisive, long-lasting impact on
their later development and learning.
(2) High-quality, developmentally appropriate
child care beginning in early childhood and con-
tinuing through the years that children are in school
improves the scholastic success and educational at-
tainment of children, and the success and attain-
ment persist into adulthood.
(3) According to a growing body of research,
the single most important determinant of child care
quality is the presence of consistent, sensitive, well-
trained, and well-compensated child care providers.
However, child care programs nationwide experience
high turnover in teaching staff, fueled by poor com-
pensation and few opportunities for advancement.
(4) Despite the important role child care pro-
viders can play in early child development and learn-
ing, in 1999 the average wage for a child care pro-
vider was $7.42 per hour, or $15,430 annually. For
full-time, full-year work, the average annual wage
for a child care provider was not much above the
1999 poverty line of $13,423 for a family consisting
of a parent and 2 children. Family child care pro-
viders earned even less. The median weekly wage of
a family child care provider in 1999 was $264,
which equals an annual wage of $13,728.
(5) To offer compensation that would be suffi-
cient to attract and retain qualified child care pro-
viders, child care programs would have to charge
parents fees that many parents could not afford. For
programs that serve low-income children whose fami-
lies qualify for Federal and State child care sub-
sidies, the reimbursement rates set by the State
strongly influence the level of compensation that
staff receive. Current reimbursement rates for cen-
ter-based child care services and family child care
services are insufficient to recruit and retain quali-
fied child care providers and to ensure high-quality
services for children.
(6) As a result of low wages and limited bene-
fits, many child care providers do not work for long
periods in the child care field. Approximately 30 per-
cent of all teaching staff employed at child care cen-
ters leaves employment with a child care center each
year. Teachers leaving the profession are being re-
placed by staff with less education and formal train-
ing in early child development.
(7) Child care providers, as well as the children,
families, and businesses that depend upon the pro-
viders, suffer the consequences of inadequate com-
pensation. This is true, with few exceptions, for pro-
viders in all types of programs, including subsidized
and nonsubsidized programs, programs offered by
for-profit and nonprofit entities, and programs in
large and small child care settings.
(8) Because of the severe nationwide shortage
of qualified staff available for employment by child
care programs, several States have recently initiated
programs to improve the quality of child care by in-
creasing the training and compensation of child care
providers. Such programs encourage the training,
education, and increased retention of qualified child
care providers by offering financial incentives, in-
cluding scholarships and increases in compensation,
that range from $350 to $6,500 annually.
(b) PURPOSES.—The purposes of this title are—
(1) to establish the Child Care Provider Devel-
opment and Retention Grant Program and the Child
Care Provider Scholarship Program; and
(2) to help children receive the high quality
child care and early education the children need for
positive cognitive and social development, by reward-
ing and promoting the retention of committed, quali-
fied child care providers and by providing financial
assistance to improve the educational qualifications
of child care providers.
SEC. 203. DEFINITIONS.
In this title:
(1) CHILD CARE PROVIDER.—The term ‘‘child
care provider’’ means an individual who provides a
service directly to a child on a person to person basis
for compensation for—
(A) a center-based child care provider that
is licensed or regulated under State or local law
and that satisfies the State and local require-
ments applicable to the child care services pro-
vided;
(B) a licensed or regulated family child
care provider that satisfies the State and local
requirements applicable to the child care serv-
ices provided; or
(C) an out-of-school time program that is
licensed or regulated under State or local law
and that satisfies the State and local require-
ments applicable to the child care services pro-
vided.
(2) FAMILY CHILD CARE PROVIDER.—The term
‘‘family child care provider’’ has the meaning given
such term in section 658P of the Child Care and
Development Block Grant Act of 1990 (42 U.S.C.
9858n).
(3) INDIAN TRIBE.—The term ‘‘Indian tribe’’
has the meaning given such term in section 4 of the
Indian Self-Determination and Education Assistance
Act (25 U.S.C. 450b).
(4) IN-KIND
CONTRIBUTION.—The term ‘‘in-
kind contribution’’ means payment of the costs of
participation of eligible child care providers in health
insurance programs or retirement programs.
(5) LEAD AGENCY.—The term ‘‘lead agency’’
means the agency designated under section 658D of
the Child Care and Development Block Grant Act of
1990 (42 U.S.C. 9858b).
(6) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Health and Human Services.
(7) STATE.—The term ‘‘State’’ means any of
the several States, the District of Columbia, the
Commonwealth of Puerto Rico, Guam, American
Samoa, or the Commonwealth of the Northern Mar-
iana Islands.
(8) TRIBAL ORGANIZATION.—The term ‘‘tribal
organization’’ has the meaning given the term in
section 4 of the Indian Self-Determination and Edu-
cation Assistance Act (25 U.S.C. 450b).
SEC. 204. FUNDS FOR CHILD CARE PROVIDER DEVELOP-
MENT AND RETENTION GRANTS AND FOR
CHILD CARE PROVIDER SCHOLARSHIPS.
(a) IN GENERAL.—The Secretary may allot and dis-
tribute funds appropriated to carry out this title to eligible
States and Indian tribes and tribal organizations to pay
for the Federal share of the cost of making grants under
sections 207 and 208 to eligible child care providers.
(b) ALLOTMENTS.—The funds shall be allotted and
distributed by the Secretary in accordance with section
205, and expended by the States (directly, or at the option
of the States, through units of general purpose local gov-
ernment), and by Indian tribes and tribal organizations,
in accordance with this title.
SEC. 205. ALLOTMENTS TO STATES.
(a) AMOUNTS RESERVED.—
(1) TERRITORIES AND POSSESSIONS.—The Sec-
retary shall reserve not more than 1⁄2 of 1 percent
of the funds appropriated to carry out this title for
any fiscal year for distribution to Guam, American
Samoa, and the Commonwealth of the Northern
Mariana Islands, to be allotted in accordance with
their respective needs, to plan and carry out pro-
grams and activities to encourage child care pro-
viders to improve their qualifications and to retain
qualified child care providers in the child care field.
(2) INDIAN
TRIBES
AND
TRIBAL
ORGANIZA-
TIONS.—The Secretary shall reserve not more than
3 percent of the funds appropriated to carry out this
title for any fiscal year for payments to Indian tribes
and tribal organizations with applications approved
under subsection (c), to plan and carry out pro-
grams and activities to encourage child care pro-
viders to improve their qualifications and to retain
qualified child care providers in the child care field.
(b) ALLOTMENTS TO REMAINING STATES.—
(1) GENERAL
AUTHORITY.—From the funds
appropriated to carry out this title for any fiscal
year and remaining after the reservations made
under subsection (a), the Secretary shall allot to
each State (excluding Guam, American Samoa, and
the Commonwealth of the Northern Mariana Is-
lands) an amount equal to the sum of—
(A) an amount that bears the same ratio
to 50 percent of such remainder as the product
of the young child factor of the State and the
allotment percentage of the State bears to the
sum of the corresponding products for all
States; and
(B) an amount that bears the same ratio
to 50 percent of such remainder as the product
of the school lunch factor of the State and the
allotment percentage of the State bears to the
sum of the corresponding products for all
States.
(2) YOUNG CHILD FACTOR.—In this subsection,
the term ‘‘young child factor’’ means the ratio of the
number of children under 5 years of age in the State
to the number of such children in all the States, as
determined according to the most recent annual esti-
mates of population in the States, as provided by the
Bureau of the Census.
(3) SCHOOL
LUNCH
FACTOR.—In this sub-
section, the term ‘‘school lunch factor’’ means the
ratio of the number of children who are receiving
free or reduced price lunches under the school lunch
program established under the Richard B. Russell
National School Lunch Act (42 U.S.C. 1751 et seq.)
in the State to the number of such children in all
the States, as determined annually by the Depart-
ment of Agriculture.
(4) ALLOTMENT PERCENTAGE.—
(A) IN GENERAL.—Except as provided in
subparagraph (B), for purposes of this sub-
section, the allotment percentage for a State
shall be determined by dividing the per capita
income of all individuals in the United States,
by the per capita income of all individuals in
the State.