1.1 	A bill for an act
1.2 	relating to human services; modifying child care assistance maximum rates, 
1.3 	absent days, and parent fees; amending Minnesota Statutes 2004, section 
1.4 	119B.12, subdivision 2; Minnesota Statutes 2005 Supplement, section 119B.13, 
1.5 	subdivisions 1, 7.
1.6 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.7 	Section 1. Minnesota Statutes 2004, section 119B.12, subdivision 2, is amended to read:
1.8 		Subd. 2.Parent fee. A family must be assessed a parent fee for each service period. 
1.9 	A family's parent fee must be a fixed percentage of its annual gross income. Parent fees 
1.10 	must apply to families eligible for child care assistance under sections  119B.03 and  
1.11 	119B.05. Income must be as defined in section  119B.011, subdivision 15. The fixed 
1.12 	percent is based on the relationship of the family's annual gross income to 100 percent of 
1.13 	the annual federal poverty guidelines. Parent fees must begin at 75 percent of the poverty 
1.14 	level. The minimum parent fees for families between 75 percent and 100 percent of 
1.15 	poverty level must be $10 per month. Parent fees must provide for graduated movement 
1.16 	to full payment. Payment of part or all of a family's parent fee directly to the family's 
1.17 	child care provider on behalf of the family by a source other than family shall not affect 
1.18 	the family's eligibility for child care assistance, and the amount paid shall be excluded 
1.19 	from the family's income. Child care providers who accept third-party payments must 
1.20 	maintain family specific documentation of payment source, amount, and time period 
1.21 	covered by the payment.

1.22 	Sec. 2. Minnesota Statutes 2005 Supplement, section 119B.13, subdivision 1, is 
1.23 	amended to read:
2.1 		Subdivision 1.Subsidy restrictions. (a)(i) Effective July 1, 2005, the commissioner 
2.2 	of human services shall modify the rate tables for child care centers published in 
2.3 	Department of Human Services Bulletin No. 03-68-07 so that in counties with regional or 
2.4 	statewide cells, the higher of the 100th percentile of the 2002 market rate survey data or 
2.5 	the rate currently identified in the bulletin will be the maximum rate. The rates established 
2.6 	in this clause will be considered as the previous year's rates for purposes of the increase in 
2.7 	item (iii), and shall be compared to the 100th percentile of current market rates.
2.8 	(ii) For the period between July 1, 2005, and through the full implementation of the 
2.9 	new rates under item (iii), the rates published in Department of Human Services Bulletin 
2.10 	No. 03-68-07 as adjusted by item (i) shall remain in effect.
2.11 	(iii) Beginning January 1, 2006, the maximum rate paid for child care assistance 
2.12 	in any county or multicounty region under the child care fund shall be the lesser of the 
2.13 	75th percentile rate for like-care arrangements in the county or multicounty region as 
2.14 	surveyed by the commissioner or the previous year's rate for like-care arrangements 
2.15 	in the county increased by 1.75 percent.
2.16 	(iv) Rate changes shall be implemented for services provided in March 2006 unless a 
2.17 	participant eligibility redetermination or a new provider agreement is completed between 
2.18 	January 1, 2006, and February 28, 2006.
2.19 	As necessary, appropriate notice of adverse action must be made according to 
2.20 	Minnesota Rules, part 3400.0185, subparts 3 and 4.
2.21 	New cases approved on or after January 1, 2006, shall have the maximum rates 
2.22 	under item (iii) implemented immediately.
2.23 	(b) Not less than once every two years, the commissioner shall survey rates 
2.24 	charged by child care providers in Minnesota to determine the 75th percentile for 
2.25 	like-care arrangements in counties. When the commissioner determines that, using the 
2.26 	commissioner's established protocol, the number of providers responding to the survey is 
2.27 	too small to determine the 75th percentile rate for like-care arrangements in a county or 
2.28 	multicounty region, the commissioner may establish the 75th percentile maximum rate 
2.29 	based on like-care arrangements in a county, region, or category that the commissioner 
2.30 	deems to be similar.
2.31 	(c) A rate which includes a special needs rate paid under subdivision 3 may be in 
2.32 	excess of the maximum rate allowed under this subdivision.
2.33 	(d) The department shall monitor the effect of this paragraph on provider rates. The 
2.34 	county shall pay the provider's full charges for every child in care up to the maximum 
2.35 	established. The commissioner shall determine the maximum rate for each type of care on 
2.36 	an hourly, full-day, and weekly basis, including special needs and handicapped care. The 
3.1 	commissioner shall also determine the maximum rate for school age care on a half-day 
3.2 	basis.
3.3 	(e) When the provider charge is greater than the maximum provider rate allowed, 
3.4 	the parent is responsible for payment of the difference in the rates in addition to any 
3.5 	family co-payment fee.

3.6 	EFFECTIVE DATE. This section is effective July 1, 2006.

3.7 	Sec. 3. Minnesota Statutes 2005 Supplement, section 119B.13, subdivision 7, is 
3.8 	amended to read:
3.9 		Subd. 7.Absent days. (a) Child care providers may not be reimbursed for more 
3.10 	than 25 full-day absent days per child, excluding holidays, in a fiscal year, or for more than 
3.11 	ten consecutive full-day absent days, unless the child has a documented medical condition 
3.12 	that causes more frequent absences. Documentation of medical conditions must be on 
3.13 	the forms and submitted according to the timelines established by the commissioner. If a 
3.14 	child attends for part of the time authorized to be in care in a day, but is absent for part of 
3.15 	the time authorized to be in care in that same day, the absent time will be reimbursed but 
3.16 	the time will not count toward the ten consecutive or 25 cumulative absent day limits. 
3.17 	If a child attends part of an authorized day, payment to the provider must be for the full 
3.18 	amount of care authorized for that day. Child care providers may only be reimbursed for 
3.19 	absent days if the provider has a written policy for child absences and charges all other 
3.20 	families in care for similar absences. 
3.21 	(b) Child care providers must be reimbursed for up to ten federal or state holidays 
3.22 	or designated holidays per year when the provider charges all families for these days 
3.23 	and the holiday or designated holiday falls on a day when the child is authorized to be 
3.24 	in attendance. Parents may substitute other cultural or religious holidays for the ten 
3.25 	recognized state and federal holidays. Holidays do not count toward the ten consecutive or 
3.26 	25 cumulative absent day limits. 
3.27 	(c) A family or child care provider may not be assessed an overpayment for an absent 
3.28 	day payment unless (1) there was a provider error in the amount of care authorized for the 
3.29 	family, (2) all of the allowed full-day absent payments for the child have been paid and the 
3.30 	family and child care provider had prior notification of this before the absent days were 
3.31 	used, or (3) the family or provider did not timely report a change as required under law.

3.32 	EFFECTIVE DATE. This section is effective July 1, 2006.