HF 1

2nd Engrossment - 91st Legislature (2019 - 2020) Posted on 04/14/2020 02:25pm

A bill for an act
relating to early childhood; creating additional funding and opportunities for
children ages birth to three; governing certain programs and funding for prenatal
care services, home visiting, early childhood education, and child care assistance;
appropriating money; amending Minnesota Statutes 2018, sections 119B.13,
subdivision 1; 124D.142; 124D.162; 124D.165, subdivisions 2, 3, 4; 136A.128,
subdivisions 2, 4; Minnesota Statutes 2019 Supplement, sections 124D.151,
subdivision 6; 126C.05, subdivision 1; Laws 2019, First Special Session chapter
11, article 8, section 13, subdivisions 3, 8, 9; proposing coding for new law in
Minnesota Statutes, chapters 119B; 145.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

HOME VISITING

Section 1.

new text begin [145.87] HOME VISITING FOR PREGNANT WOMEN AND FAMILIES
WITH YOUNG CHILDREN.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) The terms defined in this subdivision apply to this section
and have the meanings given them.
new text end

new text begin (b) "Evidence-based home visiting program" means a program that:
new text end

new text begin (1) is based on a clear, consistent program or model that is research-based and grounded
in relevant, empirically based knowledge;
new text end

new text begin (2) is linked to program-determined outcomes and is associated with a national
organization, institution of higher education, or national or state public health institute;
new text end

new text begin (3) has comprehensive home visitation standards that ensure high-quality service delivery
and continuous quality improvement;
new text end

new text begin (4) has demonstrated significant, sustained positive outcomes; and
new text end

new text begin (5) either:
new text end

new text begin (i) has been evaluated using rigorous, randomized controlled research designs with the
evaluations published in a peer-reviewed journal; or
new text end

new text begin (ii) is based on quasi-experimental research using two or more separate, comparable
client samples.
new text end

new text begin (c) "Evidence-informed home visiting program" means a program that:
new text end

new text begin (1) has data or evidence demonstrating the program's effectiveness at achieving positive
outcomes for pregnant women and young children; and
new text end

new text begin (2) either:
new text end

new text begin (i) has an active evaluation of the program; or
new text end

new text begin (ii) has a plan and timeline for an active evaluation of the program to be conducted.
new text end

new text begin (d) "Health equity" means every individual has a fair opportunity to attain the individual's
full health potential and no individual is prevented from achieving this potential.
new text end

new text begin Subd. 2. new text end

new text begin Grants for home visiting programs. new text end

new text begin The commissioner shall award grants to
community health boards, nonprofit organizations, and tribal nations to start up or expand
voluntary home visiting programs serving pregnant women and families with young children.
Home visiting programs supported under this section shall provide voluntary home visits
by early childhood professionals or health professionals, including nurses, social workers,
early childhood educators, or trained paraprofessionals. Grant funds shall be used to:
new text end

new text begin (1) start up or expand evidence-based home visiting programs that address health equity
or evidence-informed home visiting programs that address health equity; and
new text end

new text begin (2) serve families with young children or pregnant women who are high risk or have
high needs. For purposes of this clause, high risk includes but is not limited to a family with
low income or a parent or pregnant woman with mental illness or a substance use disorder
or experiencing domestic abuse.
new text end

new text begin Subd. 3. new text end

new text begin Grant prioritization. new text end

new text begin (a) In awarding grants, the commissioner shall give
priority to community health boards, nonprofit organizations, and tribal nations seeking to
expand home visiting services with community or regional partnerships.
new text end

new text begin (b) The commissioner shall allocate at least 75 percent of the grant funds awarded each
grant cycle to evidence-based home visiting programs that address health equity and up to
25 percent of the grant funds awarded each grant cycle to evidence-informed home visiting
programs that address health equity.
new text end

new text begin Subd. 4. new text end

new text begin No supplanting of existing funds. new text end

new text begin Funding awarded under this section shall
only be used to supplement, and not to replace, funds being used for evidence-based home
visiting programs or evidence-informed home visiting programs.
new text end

new text begin Subd. 5. new text end

new text begin Administrative costs. new text end

new text begin The commissioner may use up to ten percent of the
annual appropriation under this section to provide training and technical assistance and to
administer and evaluate the program. The commissioner may contract for training,
capacity-building support for grantees or potential grantees, technical assistance, and
evaluation support.
new text end

new text begin Subd. 6. new text end

new text begin Use of state general fund appropriations. new text end

new text begin Appropriations dedicated to starting
up or expanding evidence-based home visiting programs shall, for grants awarded on or
after July 1, 2020, be awarded according to this section. This section shall not govern grant
awards of federal funds for home visiting programs and shall not govern grant awards using
state general fund appropriations dedicated to starting up or expanding nurse-family
partnership home visiting programs.
new text end

Sec. 2. new text begin APPROPRIATION; HOME VISITING GRANTS.
new text end

new text begin $30,000,000 in fiscal year 2021 is appropriated from the general fund to the commissioner
of health for grants for home visiting programs under Minnesota Statutes, section 145.87.
This appropriation is available until June 30, 2022. This is a onetime appropriation.
new text end

ARTICLE 2

EARLY LEARNING AND CARE

Section 1.

Minnesota Statutes 2018, section 124D.142, is amended to read:

124D.142 QUALITY RATING AND IMPROVEMENT SYSTEM.

new text begin Subdivision 1. new text end

new text begin System established. new text end

deleted text begin (a) deleted text end There is established a quality rating and
improvement system (QRIS) deleted text begin framework deleted text end new text begin , known as Parent Aware, new text end to ensure that Minnesota's
children have access to high-quality early learning and care programs in a range of settings
so that they are fully ready for kindergarten deleted text begin by 2020. Creation of a deleted text end new text begin .
new text end

new text begin Subd. 2. new text end

new text begin System components. new text end

new text begin The new text end standards-based voluntary quality rating and
improvement system includes:

(1) quality opportunities in order to improve the educational outcomes of children so
that they are ready for school deleted text begin . The deleted text end new text begin ;
new text end

new text begin (2) a new text end framework deleted text begin shall be deleted text end based on the Minnesota quality rating system rating tool and
a common set of child outcome and program standards and informed by evaluation results;

deleted text begin (2) deleted text end new text begin (3) new text end a tool to increase the number of publicly funded and regulated early learning and
care services in both public and private market programs that are high quality deleted text begin . deleted text end new text begin ;
new text end

new text begin (4) voluntary participation so that new text end if a program or provider chooses to participate, the
program or provider will be rated and may receive public funding associated with the rating deleted text begin .
The state shall develop a plan to link future early learning and care state funding to the
framework in a manner that complies with federal requirements deleted text end ; and

deleted text begin (3) deleted text end new text begin (5) new text end tracking progress toward statewide access to high-quality early learning and care
programs, progress toward the number of low-income children whose parents can access
quality programs, and progress toward increasing the number of children who are fully
prepared to enter kindergarten.

deleted text begin (b) In planning a statewide quality rating and improvement system framework in
paragraph (a), the state shall use evaluation results of the Minnesota quality rating system
rating tool in use in fiscal year 2008 to recommend:
deleted text end

deleted text begin (1) a framework of a common set of child outcome and program standards for a voluntary
statewide quality rating and improvement system;
deleted text end

deleted text begin (2) a plan to link future funding to the framework described in paragraph (a), clause (2);
and
deleted text end

deleted text begin (3) a plan for how the state will realign existing state and federal administrative resources
to implement the voluntary quality rating and improvement system framework. The state
shall provide the recommendation in this paragraph to the early childhood education finance
committees of the legislature by March 15, 2011.
deleted text end

deleted text begin (c) Prior to the creation of a statewide quality rating and improvement system in paragraph
(a), the state shall employ the Minnesota quality rating system rating tool in use in fiscal
year 2008 in the original Minnesota Early Learning Foundation pilot areas and additional
pilot areas supported by private or public funds with its modification as a result of the
evaluation results of the pilot project.
deleted text end

new text begin Subd. 3. new text end

new text begin Evaluation. new text end

new text begin (a) By February 1, 2021, the commissioner of human services
must arrange an independent evaluation of the quality rating and improvement system's
effectiveness and impact on:
new text end

new text begin (1) children's progress toward school readiness;
new text end

new text begin (2) quality of the early care and education system supply and workforce; and
new text end

new text begin (3) parents' ability to access and use meaningful information about early care and
education program quality.
new text end

new text begin (b) The evaluation must be performed by a staff member from another agency or
consultant. An evaluator must have experience in program evaluation and must not be
regularly involved in implementation of the quality rating and improvement system.
new text end

new text begin (c) The evaluation findings, along with the commissioner's recommendations for
revisions, potential future evaluations, and plans for continuous improvement, must be
reported to the chairs and ranking members of the legislative committees with jurisdiction
over early learning and child care by December 31, 2023.
new text end

new text begin (d) At a minimum, the evaluation must:
new text end

new text begin (1) analyze effectiveness of the quality rating and improvement system, including but
not limited to review of:
new text end

new text begin (i) whether quality indicators and measures used in the quality rating and improvement
system are consistent with evidence and research findings on early care and education
program quality; and
new text end

new text begin (ii) patterns or differences in observed quality of participating early care and education
programs in comparison to programs at other quality rating and improvement system star
rating levels and accounting for other factors;
new text end

new text begin (2) perform evidence-based assessments of children's developmental gains in ways that
are appropriate for children's linguistic and cultural backgrounds and are aligned to the state
early childhood indicators of progress;
new text end

new text begin (3) analyze the extent to which differences in developmental gains among children
correspond to the star ratings of the early care and education programs, providing
disaggregated findings by:
new text end

new text begin (i) children's demographic factors, including geographic area, family income level, and
racial and ethnic groups;
new text end

new text begin (ii) type of provider, including family child care provider, child care center, Head Start,
and school-based early childhood provider; and
new text end

new text begin (iii) any other categories identified by the commissioner, in consultation with the
commissioners of health and education or entity performing the evaluation;
new text end

new text begin (4) analyze accessibility for providers to participate in the quality rating and improvement
system, including ease of application and supports for a provider to receive or improve a
rating, and provide disaggregated findings by geographic area and type of provider, including
family child care provider, child care center, Head Start, and school-based early childhood
provider; and
new text end

new text begin (5) analyze the availability of providers participating in the quality rating and
improvement system to families, and provide disaggregated findings by geographic area
and type of provider, including family child care provider, child care center, Head Start and
Early Head Start, and school-based early childhood provider.
new text end

Sec. 2.

Minnesota Statutes 2019 Supplement, section 124D.151, subdivision 6, is amended
to read:

Subd. 6.

Participation limits.

(a) Notwithstanding section 126C.05, subdivision 1,
paragraph (d), the pupil units for a voluntary prekindergarten program for an eligible school
district or charter school must not exceed 60 percent of the kindergarten pupil units for that
school district or charter school under section 126C.05, subdivision 1, paragraph (e).

(b) In reviewing applications under subdivision 5, the commissioner must limit the total
number of participants in the voluntary prekindergarten and school readiness plus programs
under Laws 2017, First Special Session chapter 5, article 8, section 9, to not more than 7,160
participants deleted text begin for deleted text end new text begin per new text end fiscal deleted text begin years 2019, 2020, and 2021, and 3,160 participants for fiscal years
2022 and later deleted text end new text begin year new text end .

Sec. 3.

Minnesota Statutes 2018, section 124D.162, is amended to read:

124D.162 KINDERGARTEN READINESS ASSESSMENT.

new text begin Subdivision 1. new text end

new text begin Implementation. new text end

new text begin (a) new text end The commissioner of education deleted text begin may deleted text end new text begin must new text end implement
a kindergarten readiness assessment deleted text begin representative deleted text end of incoming kindergartners deleted text begin . deleted text end new text begin to:
new text end

new text begin (1) identify preparedness of a child for success in school;
new text end

new text begin (2) inform instructional decision-making;
new text end

new text begin (3) improve understanding of connections between kindergarten readiness and later
academic achievement; and
new text end

new text begin (4) produce data that can assist in evaluation of the effectiveness of early childhood
programs.
new text end

new text begin (b) The commissioner must provide districts and charter schools with a process for
measuring the kindergarten readiness of incoming kindergartners on a comparable basis.
The commissioner must approve one or more measurement tools for district and charter
school use.
new text end

new text begin Subd. 2. new text end

new text begin Assessment development. new text end

The new text begin measurement tools used for new text end assessment must
be deleted text begin based on the Department of Education Kindergarten Readiness Assessment at kindergarten
entrance study deleted text end new text begin research based, developmentally appropriate, valid and reliable, and aligned
to the state early childhood indicators of progress and kindergarten academic standards new text end .

new text begin Subd. 3. new text end

new text begin Reporting. new text end

new text begin Beginning in the 2021-2022 school year, every district and charter
school must use the commissioner-provided process. Every district and charter school must
annually report kindergarten readiness results under this section to the department in the
form and manner determined by the commissioner concurrent with the district's and charter
school's world's best workforce report under section 120B.11. The commissioner must
publicly report kindergarten readiness results as part of the performance reports required
under section 120B.36 and consistent with section 120B.35, subdivision 3, paragraph (a),
clause (2).
new text end

new text begin Subd. 4. new text end

new text begin Longitudinal data system. new text end

new text begin Beginning with data reported on incoming
kindergartners in the 2021-2022 school year, the commissioner must integrate kindergarten
readiness data under this section into statewide longitudinal educational data systems.
new text end

Sec. 4.

Minnesota Statutes 2018, section 124D.165, subdivision 2, is amended to read:

Subd. 2.

Family eligibility.

(a) For a family to receive an early learning scholarship,
parents or guardians must meet the following eligibility requirements:

(1) have an eligible child; and

(2) have income equal to or less than 185 percent of federal poverty level income in the
current calendar year, or be able to document their child's current participation in the free
and reduced-price lunch program or Child and Adult Care Food Program, National School
Lunch Act, United States Code, title 42, sections 1751 and 1766; the Food Distribution
Program on Indian Reservations, Food and Nutrition Act, United States Code, title 7, sections
2011-2036; Head Start under the federal Improving Head Start for School Readiness Act
of 2007; Minnesota family investment program under chapter 256J; child care assistance
programs under chapter 119B; the supplemental nutrition assistance program; or placement
in foster care under section 260C.212.

(b) An "eligible child" means a child who has not yet enrolled in kindergarten and is:

(1) deleted text begin at least deleted text end new text begin from birth through new text end three deleted text begin but not yet five deleted text end years of age on September 1 of the
current school year;

(2) a sibling from birth deleted text begin to deleted text end new text begin through new text end age deleted text begin five deleted text end new text begin four new text end of a child who has been awarded a
scholarship under this section provided the sibling attends the same program as long as
funds are available;

(3) the child of a parent under age 21 who is pursuing a high school degree or a course
of study for a high school equivalency test; deleted text begin or
deleted text end

(4) homeless, in foster care, or in need of child protective services new text begin ; or
new text end

new text begin (5) a child not yet five years of age on September 1 of the current school year participating
in a program with a designated number of scholarship seats under subdivision 3, paragraph
(c) new text end .

(c) new text begin Notwithstanding the age requirements under paragraph (b), new text end a child who has received
a scholarship under this section must continue to receive a scholarship each year until that
child is eligible for kindergarten under section 120A.20 and as long as funds are available.

(d) Early learning scholarships may not be counted as earned income for the purposes
of medical assistance under chapter 256B, MinnesotaCare under chapter 256L, Minnesota
family investment program under chapter 256J, child care assistance programs under chapter
119B, or Head Start under the federal Improving Head Start for School Readiness Act of
2007.

(e) A child from an adjoining state whose family resides at a Minnesota address as
assigned by the United States Postal Service, who has received developmental screening
under sections 121A.16 to 121A.19, who intends to enroll in a Minnesota school district,
and whose family meets the criteria of paragraph (a) is eligible for an early learning
scholarship under this section.

Sec. 5.

Minnesota Statutes 2018, section 124D.165, subdivision 3, is amended to read:

Subd. 3.

Administration.

(a) The commissioner shall establish application timelines
and determine the schedule for awarding scholarships that meets operational needs of eligible
families and programs. The commissioner must give highest priority to applications from
children who:

(1) have a parent under age 21 who is pursuing a high school diploma or a course of
study for a high school equivalency test;

(2) are in foster care or otherwise in need of protection or services; or

(3) have experienced homelessness in the last 24 months, as defined under the federal
McKinney-Vento Homeless Assistance Act, United States Code, title 42, section 11434a.

The commissioner may prioritize applications on additional factors including family
income, geographic location, and whether the child's family is on a waiting list for a publicly
funded program providing early education or child care services.

(b) The commissioner shall establish a target for the average scholarship amount per
child based on the results of the rate survey conducted under section 119B.02.

(c) A four-star rated program that has children eligible for a scholarship enrolled in or
on a waiting list for a program beginning in July, August, or September may notify the
commissioner, in the form and manner prescribed by the commissioner, each year of the
program's desire to enhance program services or to serve more children than current funding
provides. The commissioner may designate a predetermined number of scholarship slots
for that program and notify the program of that number. For fiscal year 2018 and later, the
statewide amount of funding directly designated by the commissioner must not exceed the
funding directly designated for fiscal year 2017. Beginning July 1, 2016, a school district
or Head Start program qualifying under this paragraph may use its established registration
process to enroll scholarship recipients and may verify a scholarship recipient's family
income in the same manner as for other program participants.

(d) A scholarship is awarded for a 12-month period. If the scholarship recipient has not
been accepted and subsequently enrolled in a rated program within ten months of the
awarding of the scholarship, the scholarship cancels and the recipient must reapply in order
to be eligible for another scholarship. A child may not be awarded more than one scholarship
in a 12-month period.

(e) A child who receives a scholarship who has not completed development screening
under sections 121A.16 to 121A.19 must complete that screening within 90 days of first
attending an eligible program new text begin or within 90 days of the child's third birthday if awarded a
scholarship under the age of three new text end .

(f) For fiscal year 2017 and later, a school district or Head Start program enrolling
scholarship recipients under paragraph (c) may apply to the commissioner, in the form and
manner prescribed by the commissioner, for direct payment of state aid. Upon receipt of
the application, the commissioner must pay each program directly for each approved
scholarship recipient enrolled under paragraph (c) according to the metered payment system
or another schedule established by the commissioner.

Sec. 6.

Minnesota Statutes 2018, section 124D.165, subdivision 4, is amended to read:

Subd. 4.

Early childhood program eligibility.

(a) In order to be eligible to accept an
early learning scholarship, a program must:

(1) participate in the quality rating and improvement system under section 124D.142;
and

(2) beginning deleted text begin July 1, 2020 deleted text end new text begin when 40 percent of programs eligible for rating under section
124D.142 have received ratings new text end , have a three- or four-star rating in the quality rating and
improvement system.

(b) Any program accepting scholarships must use the revenue to supplement and not
supplant federal funding.

deleted text begin (c) Notwithstanding paragraph (a), all Minnesota early learning foundation scholarship
deleted text end deleted text begin program pilot sites are eligible to accept an early learning scholarship under this section.
deleted text end

Sec. 7.

Minnesota Statutes 2019 Supplement, section 126C.05, subdivision 1, is amended
to read:

Subdivision 1.

Pupil unit.

Pupil units for each Minnesota resident pupil under the age
of 21 or who meets the requirements of section 120A.20, subdivision 1, paragraph (c), in
average daily membership enrolled in the district of residence, in another district under
sections 123A.05 to 123A.08, 124D.03, 124D.08, or 124D.68; in a charter school under
chapter 124E; or for whom the resident district pays tuition under section 123A.18, 123A.22,
123A.30, 123A.32, 123A.44, 123A.488, 123B.88, subdivision 4, 124D.04, 124D.05, 125A.03
to 125A.24, 125A.51, or 125A.65, shall be counted according to this subdivision.

(a) A prekindergarten pupil with a disability who is enrolled in a program approved by
the commissioner and has an individualized education program is counted as the ratio of
the number of hours of assessment and education service to 825 times 1.0 with a minimum
average daily membership of 0.28, but not more than 1.0 pupil unit.

(b) A prekindergarten pupil who is assessed but determined not to be disabled is counted
as the ratio of the number of hours of assessment service to 825 times 1.0.

(c) A kindergarten pupil with a disability who is enrolled in a program approved by the
commissioner is counted as the ratio of the number of hours of assessment and education
services required in the fiscal year by the pupil's individualized education program to 875,
but not more than one.

(d) A prekindergarten pupil who is not included in paragraph (a) or (b) and is enrolled
in an approved voluntary prekindergarten program under section 124D.151 is counted as
the ratio of the number of hours of instruction to 850 times 1.0, but not more than 0.6 pupil
units.

(e) A kindergarten pupil who is not included in paragraph (c) is counted as 1.0 pupil
unit if the pupil is enrolled in a free all-day, every day kindergarten program available to
all kindergarten pupils at the pupil's school that meets the minimum hours requirement in
section 120A.41, or is counted as .55 pupil unit, if the pupil is not enrolled in a free all-day,
every day kindergarten program available to all kindergarten pupils at the pupil's school.

(f) A pupil who is in any of grades 1 to 6 is counted as 1.0 pupil unit.

(g) A pupil who is in any of grades 7 to 12 is counted as 1.2 pupil units.

(h) A pupil who is in the postsecondary enrollment options program is counted as 1.2
pupil units.

(i) deleted text begin For fiscal years 2018 through 2021, deleted text end A prekindergarten pupil who:

(1) is not included in paragraph (a), (b), or (d);

(2) is enrolled in a school readiness plus program under Laws 2017, First Special Session
chapter 5, article 8, section 9; and

(3) has one or more of the risk factors specified by the eligibility requirements for a
school readiness plus program,

is counted as the ratio of the number of hours of instruction to 850 times 1.0, but not more
than 0.6 pupil units. A pupil qualifying under this paragraph must be counted in the same
manner as a voluntary prekindergarten student for all general education and other school
funding formulas.

Sec. 8.

Laws 2019, First Special Session chapter 11, article 8, section 13, subdivision 3,
is amended to read:

Subd. 3.

Early learning scholarships.

(a) For the early learning scholarship program
under Minnesota Statutes, section 124D.165:

	$	75,209,000	.....	2020
	$	deleted text begin 70,709,000 deleted text end new text begin 260,709,000 new text end	.....	2021

(b) This appropriation is subject to the requirements under Minnesota Statutes, section
124D.165, subdivision 6.

new text begin (c) The base for each of fiscal years 2022 and 2023 is $70,709,000.
new text end

Sec. 9.

Laws 2019, First Special Session chapter 11, article 8, section 13, subdivision 8,
is amended to read:

Subd. 8.

Kindergarten deleted text begin entrance deleted text end new text begin readiness new text end assessment deleted text begin initiative and intervention
program deleted text end .

For the kindergarten deleted text begin entrance deleted text end new text begin readiness new text end assessment deleted text begin initiative and intervention
program deleted text end under Minnesota Statutes, section 124D.162:

	$	281,000	.....	2020
	$	deleted text begin 281,000 deleted text end new text begin 2,693,000 new text end	.....	2021

new text begin The base for each of fiscal years 2022 and 2023 is $2,000,000.
new text end

Sec. 10.

Laws 2019, First Special Session chapter 11, article 8, section 13, subdivision 9,
is amended to read:

Subd. 9.

Quality rating and improvement system.

(a) For transfer to the commissioner
of human services for the purposes of expanding the quality rating and improvement system
under Minnesota Statutes, section 124D.142, in greater Minnesota and increasing supports
for providers participating in the quality rating and improvement system:

	$	1,750,000	.....	2020
	$	deleted text begin 1,750,000 deleted text end new text begin 3,400,000 new text end	.....	2021

(b) The amounts in paragraph (a) must be in addition to any federal funding under the
child care and development block grant authorized under Public Law 101-508 in that year
for the system under Minnesota Statutes, section 124D.142.

(c) Any balance in the first year does not cancel but is available in the second year.

new text begin (d) The base for each of fiscal years 2022 and 2023 is $1,750,000.
new text end

new text begin (e) The onetime, supplemental funds appropriated in fiscal year 2021 are for the purposes
of the quality rating and improvement system's evaluation, and remain available until June
30, 2023.
new text end

Sec. 11. new text begin FAMILY CHILD CARE REGULATION MODERNIZATION.
new text end

new text begin (a) The commissioner of human services shall contract with an experienced and
independent organization or individual consultant to conduct the work outlined in this
section. If practicable, the commissioner must contract with the National Association for
Regulatory Administration.
new text end

new text begin (b) The consultant must develop a proposal for a risk-based model for monitoring
compliance with family child care licensing standards, grounded in national regulatory best
practices. Violations in the new model must be weighted to reflect the potential risk they
pose to children's health and safety, and licensing sanctions must be tied to the potential
risk. The proposed new model must protect the health and safety of children in family child
care programs and be child centered, family friendly, and fair to providers.
new text end

new text begin (c) The consultant shall develop and implement a stakeholder engagement process that
solicits input from parents, licensed family child care providers, county licensors, staff of
the Department of Human Services, and experts in child development about appropriate
licensing standards, appropriate tiers for violations of the standards, based on the potential
risk of harm that each violation poses, and appropriate licensing sanctions for each tier.
new text end

new text begin (d) The consultant shall solicit input from parents, licensed family child care providers,
county licensors, and staff of the Department of Human Services about which family child
care providers should be eligible for abbreviated inspections that predict compliance with
other licensing standards for licensed family child care providers using key indicators
previously identified using an empirically based statistical methodology developed by the
National Association for Regulatory Administration and the Research Institute for Key
Indicators.
new text end

new text begin (e) No later than February 1, 2023, the commissioner shall submit a report and proposed
legislation required to implement the new licensing model to the chairs and ranking minority
members of the legislative committees with jurisdiction over child care regulation.
new text end

Sec. 12. new text begin APPROPRIATION; FAMILY CHILD CARE REGULATION
MODERNIZATION.
new text end

new text begin $1,500,000 in fiscal year 2021 is appropriated from the general fund to the commissioner
of human services for the family child care regulation modernization project under section
10. This is a onetime appropriation and remains available until June 30, 2023.
new text end

ARTICLE 3

CHILD CARE AVAILABILITY

Section 1.

Minnesota Statutes 2018, section 119B.13, subdivision 1, is amended to read:

Subdivision 1.

Subsidy restrictions.

(a) deleted text begin Beginning February 3, 2014, deleted text end The maximum
rate paid for child care assistance deleted text begin in any county or county price cluster deleted text end under the child care
fund shall be deleted text begin the greater of the 25th percentile of the 2011 child care provider rate survey
or the maximum rate effective November 28, 2011. deleted text end new text begin :
new text end

new text begin (1) for family child care, the 25th percentile of the market rate in the county or county
price cluster with the highest cost 25th percentile for family child care in the most recent
child care provider rate survey under section 119B.02, subdivision 7; and
new text end

new text begin (2) for child care centers, the 25th percentile of the market rate in the most recent child
care provider rate survey under section 119B.02, subdivision 7. new text end For a child care deleted text begin provider deleted text end new text begin
center new text end located within the boundaries of a city located in two or more of the counties of
Benton, Sherburne, and Stearns, the maximum rate paid for child care assistance shall be
equal to the maximum rate paid in the county with the highest maximum reimbursement
rates or the provider's charge, whichever is less.

new text begin (b) new text end The commissioner may: (1) assign a county with no reported provider prices to a
similar price cluster; and (2) consider county level access when determining final price
clusters new text begin under section 119B.02, subdivision 7 new text end .

deleted text begin (b) deleted text end new text begin (c) new text end A rate which includes a special needs rate paid under subdivision 3 may be in
excess of the maximum rate allowed under this subdivision.

deleted text begin (c) deleted text end new text begin (d) new text end The department shall monitor the effect of this paragraph on provider rates. The
county shall pay the provider's full charges for every child in care up to the maximum
established. The commissioner shall determine the maximum rate for each type of care on
an hourly, full-day, and weekly basis, including special needs and disability care.

deleted text begin (d) deleted text end new text begin (e) new text end If a child uses one provider, the maximum payment for one day of care must not
exceed the daily rate. The maximum payment for one week of care must not exceed the
weekly rate.

deleted text begin (e) deleted text end new text begin (f) new text end If a child uses two providers under section 119B.097, the maximum payment
must not exceed:

(1) the daily rate for one day of care;

(2) the weekly rate for one week of care by the child's primary provider; and

(3) two daily rates during two weeks of care by a child's secondary provider.

deleted text begin (f) deleted text end new text begin (g) new text end Child care providers receiving reimbursement under this chapter must not be paid
activity fees or an additional amount above the maximum rates for care provided during
nonstandard hours for families receiving assistance.

deleted text begin (g) deleted text end new text begin (h) new text end If the provider charge is greater than the maximum provider rate allowed, the
parent is responsible for payment of the difference in the rates in addition to any family
co-payment fee.

deleted text begin (h) deleted text end new text begin (i) new text end All maximum provider rates changes shall be implemented on the Monday
following the effective date of the maximum provider rate.

deleted text begin (i) Notwithstanding Minnesota Rules, part 3400.0130, subpart 7, maximum registration
fees in effect on January 1, 2013, shall remain in effect. deleted text end new text begin (j) The maximum registration fee
paid for child care assistance in any county or county price cluster under the child care fund
must be the greater of:
new text end

new text begin (1) the 25th percentile of the market rate in the county or county price cluster with the
highest cost 25th percentile in the most recent child care provider rate survey under section
119B.02, subdivision 7; or
new text end

new text begin (2) the registration fee in effect at the time of the update.
new text end

new text begin (k) A maximum registration fee must be set for licensed family child care and for child
care centers.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective September 18, 2020.
new text end

Sec. 2.

new text begin [119B.195] RETAINING EARLY EDUCATORS THROUGH ATTAINING
INCENTIVES NOW (REETAIN) GRANT PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment; purpose. new text end

new text begin The retaining early educators through attaining
incentives now (REETAIN) grant program is established to provide competitive grants to
incentivize well-trained child care professionals to stay in the workforce to create more
consistent care for children over time.
new text end

new text begin Subd. 2. new text end

new text begin Administration. new text end

new text begin The commissioner shall administer the REETAIN grant
program through a grant to a nonprofit organization with demonstrated ability to manage
benefit programs for child care professionals. Up to ten percent of grant funds may be used
for administration of the grant program.
new text end

new text begin Subd. 3. new text end

new text begin Application. new text end

new text begin An applicant must apply for the grant program using the forms
and according to the timelines established by the commissioner.
new text end

new text begin Subd. 4. new text end

new text begin Eligibility. new text end

new text begin (a) To be eligible for a grant, an applicant must:
new text end

new text begin (1) be licensed to provide child care or work for a licensed child care program;
new text end

new text begin (2) work directly with children at least 30 hours per week;
new text end

new text begin (3) work in their current position for at least 12 months;
new text end

new text begin (4) agree to stay in their current position for at least 12 months upon receiving a grant
under this section;
new text end

new text begin (5) have a career lattice step of six or higher;
new text end

new text begin (6) have a current membership with the Minnesota quality improvement and registry
tool; and
new text end

new text begin (7) meet any other requirements determined by the commissioner.
new text end

new text begin (b) Grant recipients must sign a contract agreeing to remain in their current position for
at least 12 months.
new text end

new text begin Subd. 5. new text end

new text begin Grant awards. new text end

new text begin To the extent funding is available, a child care professional's
annual amount for the REETAIN grant must not exceed an amount determined by the
commissioner. A child care professional must apply each year to compete for an award and
may receive up to one award per year. Grant funds may be used for program supplies,
training, or personal expenses.
new text end

new text begin Subd. 6. new text end

new text begin Report. new text end

new text begin Beginning January 1, 2022, and each year thereafter, the commissioner
must report annually to the legislative committees with jurisdiction over child care on the
number of grants awarded and outcomes of the grant program.
new text end

Sec. 3.

Minnesota Statutes 2018, section 136A.128, subdivision 2, is amended to read:

Subd. 2.

Program components.

(a) The nonprofit organization must use the grant for:

(1) tuition scholarships up to deleted text begin $5,000 deleted text end new text begin $10,000 new text end per year for courses leading to the nationally
recognized child development associate credential or college-level courses leading to an
associate's new text begin degree new text end or bachelor's degree in early childhood development and school-age care;
and

(2) education incentives of a minimum of deleted text begin $100 deleted text end new text begin $250 new text end to participants in the tuition
scholarship program if they complete a year of working in the early care and education
field.

(b) Applicants for the scholarship must be employed by a licensed early childhood or
child care program and working directly with children, a licensed family child care provider,
new text begin employed by a public prekindergarten program, new text end or an employee in a school-age program
exempt from licensing under section 245A.03, subdivision 2, paragraph (a), clause (12).
Lower wage earners must be given priority in awarding the tuition scholarships. Scholarship
recipients must contribute new text begin at least new text end ten percent of the total scholarship and must be sponsored
by their employers, who must also contribute deleted text begin ten deleted text end new text begin at least five new text end percent of the total scholarship.
Scholarship recipients who are self-employed must contribute 20 percent of the total
scholarship.

Sec. 4.

Minnesota Statutes 2018, section 136A.128, subdivision 4, is amended to read:

Subd. 4.

Administration.

A nonprofit organization that receives a grant under this
section may use deleted text begin five deleted text end new text begin ten new text end percent of the grant amount to administer the program.

Sec. 5.

new text begin FAMILY, FRIEND, AND NEIGHBOR GRANT PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin A family, friend, and neighbor (FFN) grant program is
established to promote children's social emotional learning and healthy development, early
literacy, and school readiness, and to foster community partnerships to promote children's
school readiness. The commissioner of health must make grants available to fund:
new text end

new text begin (1) community health boards, local or regional libraries, community-based organizations,
nonprofit organizations, and Indian tribes working with FFN caregivers under subdivision
2; and
new text end

new text begin (2) community-based partnerships to implement early literacy programs under subdivision
3.
new text end

new text begin The commissioner must attempt to ensure that grants under subdivisions 2 and 3 are made
in all areas of the state.
new text end

new text begin Subd. 2. new text end

new text begin Grants to work with FFN caregivers. new text end

new text begin (a) Grants awarded by the commissioner
under this paragraph may be used by community health boards, local or regional libraries,
community-based organizations, nonprofit organizations, and Indian tribes working with
FFN caregivers in local communities, cultural communities, and Indian tribes to:
new text end

new text begin (1) provide training, support, and resources to FFN caregivers in order to improve and
promote children's health, safety, nutrition, and school readiness;
new text end

new text begin (2) connect FFN caregivers and children's families with appropriate community resources
that support the families' physical and mental health, and economic and developmental
needs;
new text end

new text begin (3) connect FFN caregivers and children's families to early childhood screening programs
and facilitate referrals where appropriate;
new text end

new text begin (4) provide FFN caregivers and children's families with information about early learning
guidelines from the Departments of Human Services and Education;
new text end

new text begin (5) provide FFN caregivers and children's families with information about becoming a
licensed family child care provider; and
new text end

new text begin (6) provide FFN caregivers and children's families with information about early learning
allowances and enrollment opportunities in high-quality, community-based child care and
preschool programs.
new text end

new text begin (b) Grants that the commissioner awards under paragraph (a) also may be used for:
new text end

new text begin (1) social emotional learning, health and safety, and early learning kits for FFN caregivers;
new text end

new text begin (2) play and learn groups with FFN caregivers;
new text end

new text begin (3) culturally appropriate early childhood training for FFN caregivers;
new text end

new text begin (4) transportation for FFN caregivers and children's families to school readiness and
other early childhood training activities;
new text end

new text begin (5) other activities that promote school readiness;
new text end

new text begin (6) data collection and evaluation;
new text end

new text begin (7) staff outreach and outreach activities;
new text end

new text begin (8) translation needs; and
new text end

new text begin (9) administrative costs that equal up to five percent of the recipient's grant award.
new text end

new text begin Subd. 3. new text end

new text begin Grants for early literacy programs. new text end

new text begin Grants awarded by the commissioner
under this subdivision must be used to fund existing or new partnerships between community
health boards, local or regional library systems, community-based organizations, nonprofit
organizations, or Indian tribes to implement early literacy programs in low-income
communities, including tribal communities, to:
new text end

new text begin (1) purchase and equip early childhood reading mobiles and math mobiles that provide
FFN caregivers and children's families with books, training, and early literacy activities;
new text end

new text begin (2) provide FFN caregivers and children's families with translations of early childhood
books, training, and early literacy activities in native languages; or
new text end

new text begin (3) provide FFN caregivers and children's families with early literacy activities in local
libraries.
new text end

new text begin Subd. 4. new text end

new text begin Grant awards. new text end

new text begin Interested entities eligible to receive a grant under this section
may apply to the commissioner in a form and manner prescribed by the commissioner. The
commissioner shall award grants to eligible entities consistent with the requirements of this
section.
new text end

new text begin Subd. 5. new text end

new text begin Evaluation. new text end

new text begin The commissioner must evaluate the impact of the grants under
subdivisions 2 and 3 on children's school readiness, including but not limited to social
emotional learning indicators, and submit a written report to the legislative committees with
jurisdiction over health and human services and education finance and policy by February
1, 2022.
new text end

Sec. 6. new text begin FIRST CHILDREN'S FINANCE CHILD CARE SITE ASSISTANCE.
new text end

new text begin Subdivision 1. new text end

new text begin Purpose. new text end

new text begin The commissioner of human services must provide grants to
First Children's Finance for loans to improve child care or early childhood education sites
or loans to plan, design, and construct or expand licensed and legal nonlicensed sites to
increase the availability of child care or early childhood education.
new text end

new text begin Subd. 2. new text end

new text begin Financing program. new text end

new text begin (a) First Children's Finance must use grant funds to:
new text end

new text begin (1) establish a revolving loan fund to make loans to existing, expanding, and newly
licensed and legal nonlicensed child care and early childhood education sites;
new text end

new text begin (2) establish a fund to guarantee private loans to improve or construct a child care or
early childhood education site;
new text end

new text begin (3) establish a fund to provide forgivable loans or grants to match all or part of a loan
made under this section;
new text end

new text begin (4) establish a fund as a reserve against bad debt; and
new text end

new text begin (5) establish a fund to provide business planning assistance for child care providers.
new text end

new text begin (b) First Children's Finance must establish the terms and conditions for loans and loan
guarantees including interest rates, repayment agreements, private match requirements, and
conditions for loan forgiveness. A minimum interest rate for loans must be established to
ensure that necessary loan administration costs are covered. Interest earnings may be used
for administrative expenses.
new text end

new text begin Subd. 3. new text end

new text begin Reports. new text end

new text begin First Children's Finance must:
new text end

new text begin (1) by September 30, 2021, and by September 30, 2022, report to the commissioner of
human services the purposes for which the money was used during the past fiscal year,
including (i) outcomes of the program, including the number of new providers, the number
of additional child care provider jobs created, and the number of additional child care slots,
(ii) a description of projects supported by the financing, (iii) an account of loans made during
the calendar year, (iv) the financing program's assets and liabilities, and (v) an explanation
of administrative expenses; and
new text end

new text begin (2) for each fiscal year in which grants are received, submit to the commissioner of
human services a copy of the report of an independent audit performed in accordance with
generally accepted accounting practices and auditing standards.
new text end

Sec. 7. new text begin APPROPRIATION; FIRST CHILDREN'S FINANCE.
new text end

new text begin $3,000,000 in fiscal year 2021 is appropriated from the general fund to the commissioner
of human services for a grant to First Children's Finance. This is a onetime appropriation.
new text end

Sec. 8. new text begin APPROPRIATION; FAMILY, FRIEND, AND NEIGHBOR GRANT.
new text end

new text begin $1,000,000 in fiscal year 2021 is appropriated from the general fund to the commissioner
of health for purposes of awarding grants under section 5. This is a onetime appropriation
and is available until June 30, 2022.
new text end

Sec. 9. new text begin APPROPRIATION; CHILD CARE PROGRAMS.
new text end

new text begin Subdivision 1. new text end

new text begin Basic sliding fee waiting list allocation. new text end

new text begin (a) Notwithstanding Minnesota
Statutes, section 119B.03, $20,000,000 in fiscal year 2021 is appropriated from the general
fund to the commissioner of human services to reduce the basic sliding fee program waiting
list as follows:
new text end

new text begin (1) the allocations for calendar years 2020 and 2021 must be increased to serve families
on the waiting list. To receive funds appropriated for this purpose, a county must have a
waiting list in at least one of the most recent three months based on published waiting lists;
new text end

new text begin (2) funds must be distributed proportionately based on the average of the most recent
12 months of published waiting lists to counties that meet the criterion in clause (1);
new text end

new text begin (3) allocations in calendar years 2022 and beyond must be calculated using the allocation
formula in Minnesota Statutes, section 119B.03; and
new text end

new text begin (4) the guaranteed floor for calendar year 2022 must be based on the revised calendar
year 2021 allocation.
new text end

new text begin (b) This is a onetime appropriation available through fiscal year 2021.
new text end

new text begin (c) Notwithstanding Minnesota Statutes, section 119B.03, subdivisions 6, 6a, and 6b,
the commissioner must allocate the additional basic sliding fee child care funds for calendar
year 2021 to counties for updated maximum rates based on relative need to cover maximum
rate increases. In distributing the additional funds, the commissioner must consider the
following factors by county:
new text end

new text begin (1) number of children;
new text end

new text begin (2) provider type;
new text end

new text begin (3) age of children; and
new text end

new text begin (4) amount of the increase in maximum rates.
new text end

new text begin Subd. 2. new text end

new text begin Child care rates. new text end

new text begin (a) $170,000,000 in fiscal year 2021 is appropriated from
the general fund to the commissioner of human services to increase child care rates under
Minnesota Statutes, section 119B.13. The commissioner may not increase the rate differential
percentage established under Minnesota Statutes, section 119B.13, subdivision 3a or 3b.
To determine the increased rates, the commissioner of human services must:
new text end

new text begin (1) for family child care, set one rate for the entire state that is based on the county or
county price cluster with the highest costs in the most recent child care market rate survey
under Minnesota Statutes, section 119B.02, subdivision 7; and
new text end

new text begin (2) set the percentile for family child care and child care centers no higher than the 75th
percentile of the most recent market rate survey under Minnesota Statutes, section 119B.02,
subdivision 7.
new text end

new text begin (b) This is a onetime appropriation that must be used until expended to increase the child
care rates as directed in this subdivision, but at no time may the child care rates exceed the
75th percentile of the most recent market rate survey under Minnesota Statutes, section
119B.02, subdivision 7.
new text end

new text begin (c) The child care rates shall return to the rates determined under Minnesota Statutes,
section 119B.13, when the appropriation under this subdivision is expended.
new text end

Sec. 10. new text begin APPROPRIATIONS; DEPARTMENT OF EMPLOYMENT AND
ECONOMIC DEVELOPMENT.
new text end

new text begin Subdivision 1. new text end

new text begin Grants for child care. new text end

new text begin (a) $10,000,000 in fiscal year 2021 is appropriated
from the general fund to the commissioner of employment and economic development for
grants to local communities to increase the supply of quality child care providers to support
economic development. This is a onetime appropriation and is available through June 30,
2022. Fifty percent of grant funds must go to communities located outside of the seven-county
metropolitan area as defined under Minnesota Statutes, section 473.121, subdivision 2.
new text end

new text begin (b) Grant recipients must obtain a 50 percent nonstate match to grant funds in either
cash or in-kind contribution, unless the commissioner waives the requirement. Grant funds
available under this subdivision must be used to implement projects to reduce the child care
shortage in the state, including but not limited to funding for child care business start-ups
or expansion, training, facility modifications, direct subsidies or incentives to retain
employees, or improvements required for licensing, and assistance with licensing and other
regulatory requirements. In awarding grants, the commissioner must give priority to
communities that have demonstrated a shortage of child care providers in the area.
new text end

new text begin (c) Within one year of receiving grant funds, grant recipients must report to the
commissioner on the outcomes of the grant program, including but not limited to the number
of new providers, the number of additional child care provider jobs created, the number of
additional child care slots, and the amount of cash and in-kind local funds invested. Within
one month of all grant recipients reporting on program outcomes, the commissioner must
report the grant recipients' outcomes to the chairs and ranking members of the legislative
committees with jurisdiction over early learning and child care and economic development.
new text end

new text begin Subd. 2. new text end

new text begin Minnesota Initiative Foundations. new text end

new text begin (a) $3,850,000 in fiscal year 2021 is
appropriated from the general fund to the commissioner of employment and economic
development for a grant to the Minnesota Initiative Foundations. This is a onetime
appropriation and is available until June 30, 2022.
new text end

new text begin (b) The Minnesota Initiative Foundations must use grant funds under this section to:
new text end

new text begin (1) facilitate planning processes for rural communities resulting in a community solution
action plan that guides decision making to sustain and increase the supply of quality child
care in the region to support economic development;
new text end

new text begin (2) engage the private sector to invest local resources to support the community solution
action plan and ensure child care is a vital component of additional regional economic
development planning processes;
new text end

new text begin (3) provide high-quality, locally based training and technical assistance to rural child
care business owners. Access to financial and business development assistance must endeavor
to prepare child care businesses for quality engagement and improvement by stabilizing
operations, leveraging funding from other sources, and fostering business acumen; and
new text end

new text begin (4) recruit child care programs to participate in Parent Aware under Minnesota Statutes,
section 124D.142, by providing targeted resources designed to encourage high levels of
participation. The Minnesota Initiative Foundations must work with local partners to provide
low-cost training, professional development opportunities, and curriculum. The Minnesota
Initiative Foundations must fund, through local partners, an enhanced level of coaching to
rural child care providers to obtain a quality rating through Parent Aware.
new text end

new text begin Subd. 3. new text end

new text begin WomenVenture child care business training. new text end

new text begin $150,000 in fiscal year 2021
is appropriated from the general fund to the commissioner of employment and economic
development for a grant to WomenVenture to operate a business training program for child
care providers and to create materials that could be used, free of charge, for start-up,
expansion, and operation of child care businesses statewide, with the goal of helping new
and existing child care businesses in underserved areas of the state become profitable and
sustainable. The commissioner shall report data on program outcomes to the governor and
the legislative committees with jurisdiction over child care by December 15, 2022. This is
a onetime appropriation and is available until June 30, 2022.
new text end

Sec. 11. new text begin APPROPRIATION; RETAINING EARLY EDUCATORS THROUGH
ATTAINING INCENTIVES NOW (REETAIN) GRANT PROGRAM.
new text end

new text begin $2,500,000 in fiscal year 2021 is appropriated from the general fund to the commissioner
of human services for purposes of REETAIN grants under section 2. This is a onetime
appropriation.
new text end

Sec. 12. new text begin APPROPRIATION; TEACH GRANT PROGRAM.
new text end

new text begin $500,000 in fiscal year 2021 is appropriated from the general fund to the commissioner
of human services for teacher education and compensation helps (TEACH) program grants
under Minnesota Statutes, section 136A.128. This is a onetime appropriation.
new text end

Sec. 13. new text begin REVISOR INSTRUCTION.
new text end

new text begin The revisor of statutes shall renumber Minnesota Statutes, section 136A.128, as a section
in Minnesota Statutes, chapter 119B. The revisor shall also make necessary cross-reference
changes consistent with the renumbering.
new text end