Key Terms

Legislation and Initiatives

Child Care and Development Fund (CCDF): Integrated entitlement and discretionary child care funding program created in 1996 as a result of PRWORA

Child Care and Development Block Grant (CCDBG) Act: The primary law governing CCDF; created by the Omnibus Budget and Reconciliation Act of 1990 and amended by PRWORA

Good Start, Grow Smart: President Bush's early learning initiative to improve school readiness for young children in all types of early care and educational settings

Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA or P.L. 104-193): The welfare reform legislation of 1996 that created TANF and unified several Federal child care programs to form CCDF

Temporary Assistance for Needy Families (TANF): A comprehensive welfare reform program with time-limited assistance that focuses on moving recipients into work and supporting family formation. TANF replaced the former Federal welfare program, Aid to Families With Dependent Children (AFDC)

Categories of Care

Center-based child care provider: A provider who is licensed or otherwise authorized to provide child care services in a nonresidential setting

Family child care (FCC) provider: An individual who provides child care services as the sole caregiver in a private residence other than the child's home

Group home child care provider: Two or more individuals who provide child care services in a private residence other than the child's home

In-home child care provider: An individual who provides child care services in the child's own home

Legally operating without regulation: A caregiver providing services under CCDF who would not be subject to State or local child care regulations if she or he were not participating in the CCDF program; a number of States, for example, exempt from regulation family child care homes that care for a small number of children

Licensed/Regulated: A provider subject to regulation under the laws of a State or local jurisdiction

Subsidies and Services

Accessibility and Affordability: In their Biennial State Plans, States must demonstrate that families eligible for services through CCDF can choose from among the same types of care as privately paying families. Affordable family co-payments and adequate reimbursement rates are central to access. (The CCDF final rule encourages States to set their maximum rates no lower than the 75th percentile, based on their most recent market rate survey; this is intended to provide families with access to 75 percent of the child care slots in their communities.)

Annual Aggregate Report: The annual report required of the States and Territories (45 CFR 98.70 (b)) that provides aggregate or summary data on children and families served, providers receiving CCDF funds, and public education efforts. Tribes receiving CCDF grant funds are required to provide a similar annual report.

Biennial State Plan: A 2-year plan required of each State and Territory to receive its CCDF grant funding. The plan must include information on how the CCDF program will be administered in the State in compliance with CCDF statute, regulations, and policy.

CCDF Lead Agency: The State, Territorial, or Tribal entity designated to receive and administer the CCDF program, either directly or indirectly through another entity.

Case-Level Report: Provided monthly or quarterly, a report required of the States and Territories (45 CFR 98.70 (a)) that provides monthly family case-level data, including demographics of families and children served, sources of income for families served, types of child care used, and reasons for receiving care.

Certificate: A certificate, check, voucher, or other disbursement issued by a State Lead Agency to a parent to facilitate payment for child care services.

Contract: An agreement between a State Lead Agency and a provider to provide funding in exchange for direct child care services and/or reserved "slots" in child care facilities for specific populations. These services may include Head Start "wraparound" initiatives, school-age child care, and programs that target specialized populations or services, such as child care for migrant or teen parent populations or child care during nontraditional hours.

Co-Payment: The financial contribution a family receiving CCDF funding must make toward the cost of child care. The CCDBG Act requires that co-payments be determined based on a sliding fee scale that takes family size and income into account. By Federal regulation, States may consider other factors in determining co-payments, such as the number of children in child care, and may exempt families below the poverty level from making a payment. States may waive the co-payment for families at or below the Federal poverty level.

Discretionary Funds: A funding stream of CCDF authorized under the CCDBG Act and appropriated by Congress to provide child care services. In accordance with the CCDBG Act, these Federal funds are allocated based on the number of children under age 5 in a State compared to the number of such children in all States; the number of children receiving free or reduced-price lunches in a State compared to the number of such children in all States; and the per capita income of all individuals in the State (averaged over a 3-year period) compared to the national per capita income (averaged over a 3-year period).

Eligible Children: By Federal statute, children under age 13 of families with incomes up to 85 percent of the State median income and whose parent(s) is (are) working or attending a job training or educational program. States have the flexibility to set eligibility below the federally set 85 percent level. The CCDBG Act also allows States to serve children of eligible families who are under age 19 and under court supervision or mentally or physically incapable of self-care. In their Biennial State Plans, States must also indicate how they prioritize services to the very lowest income families and children with special needs.

Health and Safety Requirements: Under CCDF, States must implement requirements for child care providers that are designed to protect the health and safety of children. While States have tremendous discretion in these requirements, they must include prevention and control of infectious diseases (including immunizations), building and physical premises safety, and minimum health and safety training appropriate to the provider setting.

Mandatory Funds: A funding stream of CCDF appropriated under Title IV of the Social Security Act to States and Tribes to provide child care services. A State's share of the Mandatory Funds is based on its Federal share under the now-repealed AFDC child care programs (AFDC/JOBS Child Care, Transitional Child Care, and At-Risk Child Care) in 1994 or 1995, whichever was greater, or the average Federal share of expenditures in the State Title IV-A child care programs for 1992 through 1994. A State is not required to expend its own funds in order to receive its share of the Mandatory Funds (also known as Child Care Entitlement to the States).

Market Rate Survey: A survey of the child care rates charged by providers who care for children within the local child care market. States are encouraged to set their provider payment rates based on information from the survey.

Matching Funds: A funding stream of CCDF appropriated under Title IV of the Social Security Act to States to provide child care services. The Federal Matching Funds are the remaining portion of the funds appropriated under Title IV of the Social Security Act that are not allocated as Mandatory Funds to the States. These funds are distributed based on the number of children under age 13 in a State compared with the national total of children under age 13. To receive these funds, States must expend a designated amount of their own funds for Maintenance of Effort and must match these "remainder" funds at their Federal Medicaid Assistance Percentage Rate.

Four Percent Minimum Quality Expenditure and Earmarks: States must spend at least 4 percent of their CCDF funds to improve the quality of care through activities such as consumer education, technical assistance and training, and grants and loans to providers. In addition, there are specially earmarked funds for quality expansion, school-age care, resource and referral, and services to infants and toddlers.

Sliding Fee Scale: A system of cost sharing by a family. The family's co-payment is determined by the State (or Territory/Tribe) and is based, at a minimum, on income and size of family.