AB2314 - Childcare: alternative payment program.

Enrolled August 30, 2026 Passed IN Senate August 26, 2026 Passed IN Assembly August 26, 2026 Amended IN Senate August 21, 2026 Amended IN Assembly April 16, 2026 Amended IN Assembly March 19, 2026 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Assembly Bill No. 2314 Introduced by Assembly Member Rogers (Coauthors: Assembly Members Elhawary and Quirk-Silva) (Coauthor: Senator Ochoa Bogh) February 19, 2026 An act to add Sections 10228.2 and 10228.4 to the Welfare and Institutions Code, relating to childcare. LEGISLATIVE COUNSEL'S DIGEST AB 2314, Rogers. Childcare: alternative payment program. Existing law, the Child Care and Development Services Act, administered by the State Department of Social Services, requires the department to administer childcare and development programs that offer a full range of services to eligible children from infancy to 13 years of age, inclusive. Existing law requires the department to contract with local contracting agencies for alternative payment programs for childcare services to be provided throughout the state. Existing law then requires alternative payment programs to reimburse childcare providers for providing childcare to eligible children. This bill would, beginning October 1, 2027, authorize alternative payment programs with clear contracts and that are in full compliance with certain requirements to submit written requests to the department for a voluntary temporary transfer of funds. The bill would require the department to acknowledge receipt of the request within 30 calendar days of receiving it. The bill would require the department to provide the contractor with a written decision within 90 calendar days of receiving the request and notify the local childcare planning council in writing if a voluntary temporary transfer request is approved. The bill would authorize the department to implement these provisions by means of all-county letters, childcare bulletins, or similar written instructions until regulations are adopted. Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO Bill Text The people of the State of California do enact as follows: SECTION 1. The Legislature finds and declares all of the following: (a) California has made historic investments in subsidized childcare and early learning to support working families, promote continuity of care, and strengthen the state’s economy. (b) Ensuring that appropriated childcare and development funds are fully and effectively utilized is critical to advancing the Legislature’s intent and serving eligible families. (c) Transparent and timely voluntary temporary transfer processes support responsible stewardship of public funds. SEC. 2. Section 10228.2 is added to the Welfare and Institutions Code, to read: 10228.2. (a) The department may prioritize expenditure of funds allocated to alternative payment programs within the county or jurisdiction for which the funds were originally allocated before approving transfers outside the county of origin. (b) Prior to transferring funds allocated to alternative payment programs outside the county of origin, the department may determine that reasonable efforts to maximize enrollment and expenditures within that county have been undertaken and documented. (c) The department may consult with contractors and relevant stakeholders to develop guidance that supports enrollment maximization, fiscal alignment, and continuity of care in alternative payment programs. SEC. 3. Section 10228.4 is added to the Welfare and Institutions Code, to read: 10228.4. (a) The department shall prioritize the full and timely expenditure of state and federal childcare and development funds, consistent with federal and state law. (b) A contractor operating an alternative payment program pursuant to this chapter may submit a written request for a voluntary temporary transfer of alternative payment program funds pursuant to this section at any time during the fiscal year. (c) (1) Only contractors who possess clear contracts, as defined in Section 10397, and are in full compliance with all contractual funding terms and conditions, fiscal reporting requirements, regulatory requirements, statutory requirements, and other requirements imposed by the department, may submit a written request for a voluntary temporary transfer, as described in this section. (2) Voluntary temporary transfers, as described in this section, are intended to aid contractors with unforeseen overenrollment that causes overearning of the existing contract. (3) Contractors who request a voluntary temporary transfer, as described in this section, shall comply with any requirements imposed by the department, which may include, but are not limited to, requirements relating to pausing enrollment, coordinating transfers to other contractors, or other steps intended to minimize overearning by the requesting contractor. (d) In evaluating requests submitted pursuant to this section, the department shall consider, among other things, projected expenditures, enrollment levels, and the objective of maximizing utilization of appropriated funds consistent with state and federal law. (e) The department shall provide to the contractor a written acknowledgment of receipt of the request and the accompanying documentation, submitted pursuant to subdivision (b), within 30 calendar days of receipt. (f) Within 90 calendar days of receipt of the request, the department shall provide the contractor with a written decision regarding approval of the request, including a timeline for the transfer of funds, or denial of the request. (g) The department shall provide written notice to the local childcare planning council in which the requester is located if a voluntary temporary transfer request is approved. (h) Notwithstanding the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code), the department may implement and administer this section by all-county letters, childcare bulletins, or similar written instructions until regulations are adopted. (i) This section shall become operative October 1, 2027.