SF 2462 (LSB 5557SV (2) 91)

SENATE FILE 2462

BY  COMMITTEE ON HEALTH AND HUMAN SERVICES

(SUCCESSOR TO SSB 3111)

A BILL FOR

An Act relating to early childhood and family services, including the creation of an early childhood and family services system, state child care assistance for the child care workforce, making appropriations, and including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

DIVISION I
EARLY CHILDHOOD AND FAMILY SERVICES SYSTEM

    Section 1.  NEW SECTION.  234A.1  Definitions.
   For the purposes of this chapter, unless the context otherwise requires:
   1.  “Community resources” means locally focused, strength-based programs and supports that aim to enhance family functioning and resilience, promote child development and safety, and prevent future involvement with child protective services or the juvenile justice system.
   2.  “Department” means the department of health and human services.
   3.  “Early childhood and family services district” or “ECFS district” means a health and human services district utilized for the purpose of administering the ECFS system.
   4.  “Early childhood and family services district advisory council” or “ECFS district advisory council” means an advisory council established under section 234A.3.
   5.  “Early childhood and family services district plan” or “ECFS district plan” means a plan developed by the department to outline the ECFS system infrastructure of a district and the programs and services intended to be provided within that district.
   6.  “Early childhood and family services state plan” or “ECFS state plan” means the plan developed by the department that describes the key components of the state’s ECFS system.
   7.  “Early childhood and family services system” or “ECFS system” means the system established in section 234A.2.
   8.  “Early childhood and family services system fund” or “ECFS system fund” means the fund created in section 234A.6.
   9.  “Early intervention strategies” means services and supports designed to proactively identify and address risk factors and includes services that aim to strengthen families, promote healthy development, and reduce the likelihood of abuse or neglect by providing timely, targeted assistance to children and caregivers through the ECFS system.
   10.  “Evidence-based” means practices, programs, and policies grounded in the best available research and data, and that have been scientifically tested and shown to be effective through rigorous evaluation.
   11.  “Family support services” include group-based parent education and home visiting programs designed to strengthen protective factors including parenting skills, increase parental knowledge of child development, and increase family functioning and problem-solving skills. Family support services may be used as an early intervention strategy to improve birth outcomes, parental knowledge, family economic success, the home learning environment, family and child involvement with others, and coordination with other community resources. Family support services may have a specific focus on preventing child maltreatment or ensuring children are safe, healthy, and ready to succeed in school.
   12.  “Health and human services district” means the same as defined in section 217.1.
   13.  “HOPES-HFI program” means the healthy opportunities for parents to experience success – healthy families Iowa program established in section 234A.5.
   14.  “Ongoing family and community resources” means a continuum of sustained, accessible, and family-centered resources provided through the ECFS system that help families meet their needs, strengthen protective factors, and prevent child abuse and neglect.
   15.  “Primary prevention strategies” means a comprehensive set of services and supports provided through the ECFS system that are designed to strengthen families, promote healthy child development, and prevent adverse outcomes before they occur. These activities focus on addressing the underlying social, economic, and environmental conditions that place children and families at risk, such as poverty, social isolation, and lack of access to quality early care and education.
   16.  “Protective factor” means an inherent strength, resource, or capacity of a family, or a resource that helps a family thrive, buffer against stress, and reduce the likelihood of child abuse, neglect, or other poor outcome.
   17.  “Strength-based” means an approach that focuses on identifying and building upon the inherent strengths, resources, and capacities of a family to support the family’s growth, resilience, and well-being.
    Sec. 2.  NEW SECTION.  234A.2  Early childhood and family services system —— department powers and duties.
   1.  An early childhood and family services system is established under the control of the department for the purposes of implementing a statewide array of primary prevention strategies, early intervention strategies, and ongoing family and community resources for families and their children under nineteen years of age.
   2.  The ECFS system shall be administered in a manner to maximize funding opportunities, interagency collaboration, and integration of activities and services that support positive outcomes for children and families.
   3.  The ECFS system shall support equitable statewide access to all services, supports, and other resources offered through the ECFS system that, at a minimum, shall include all of the following:
   a.  Evidence-based primary prevention strategies, including family support services, designed to assist families in establishing healthy, successful futures.
   b.  Tailored early intervention strategies for children and families to ensure long-term well-being, including economic self-sufficiency.
   c.  Ongoing family and community resources for children and families to address the root causes of child abuse and neglect and enhance protective factors.
   d.  Specific service components including early childhood services, evidence-based family support services, and community resources.
   4.  To the extent funding is available, the department shall do all of the following to develop and administer the ECFS system and carry out the department’s duties under this chapter:
   a.  Plan, establish, and maintain primary prevention strategies, early intervention strategies, and ongoing family and community resources.
   b.  (1)  Develop an early childhood and family services state plan that is consistent with the department’s agency strategic plan adopted pursuant to section 8E.204, and the state health improvement plan developed under section 217.17.
   (2)  When developing the ECFS state plan, the department shall do all of the following:
   (a)  Collaborate with stakeholders including but not limited to experienced public health and medical providers, law enforcement, educators, the early childhood Iowa state board, the early childhood Iowa area boards, and organizations that represent populations including but not limited to children to be served by the ECFS system.
   (b)  Publish the proposed ECFS state plan on the department’s internet site and allow the public to review and comment on the proposed ECFS state plan prior to adoption.
   c.  Administer the ECFS system in each ECFS district based on early childhood and family services district plans.
   d.  Develop ECFS district plans in collaboration with ECFS system partners and stakeholders.
   e.  Establish ECFS district advisory councils pursuant to section 234A.3.
   f.  Coordinate administration of each ECFS district plan with federal and state resources.
   g.  Enter into contracts as necessary to perform activities, and provide services, supports, and other resources in accordance with each ECFS district plan.
   h.  Coordinate district activities with other state agencies and state-funded initiatives that support positive outcomes for children and families.
   i.  Administer and distribute federal aid received, and state appropriations, grants, and other moneys deposited into the early childhood and family services system fund.
   j.  Oversee, provide technical assistance to, and monitor department contractors to ensure compliance with ECFS district plans.
   k.  Establish and maintain data collection and management information systems to identify, collect, and analyze service outcomes and performance data to address the needs of clients, providers, the department, and ECFS system programs.
   l.  Collect, maintain, monitor, analyze, and utilize information including but not limited to ECFS client records and programmatic, state, and national data, engage in studies and analyses, and gather relevant statistics to understand emerging needs and effectively deploy information, resources, and technical assistance in response.
   m.  Adopt rules pursuant to chapter 17A to administer this chapter.
   n.  Take any other necessary actions to execute the department’s duties under this chapter or maintain compliance with federal requirements.
   5.  The department may do all of the following to develop and administer the ECFS system:
   a.  Cooperate with any state agency, political subdivision, or federal governmental agency to apply for grants.
   b.  Solicit and accept for use any gift of money, by will or otherwise, and any grant of money or services from the federal government, the state, a political subdivision of the state or federal government, or a private source.
    Sec. 3.  NEW SECTION.  234A.3  Early childhood and family services district advisory councils.
   1.  The department shall establish an early childhood and family services district advisory council in each ECFS district. The department shall develop policies and procedures for the operational functions of each ECFS district advisory council.
   2.  An ECFS district advisory council shall consist of ten members appointed by the department. Individuals eligible for appointment include but are not limited to all of the following:
   a.  Elected public officials who currently hold office within the ECFS district.
   b.  Individuals who have experience or expertise related to health, education, domestic assault response, or abuse response.
   c.  Individuals who are representative of the populations served in the ECFS district advisory council’s ECFS district.
   d.  Individuals who represent the faith community or community partners in the ECFS district advisory council’s ECFS district.
   3.  An ECFS district advisory council shall do all of the following:
   a.  Identify opportunities and address challenges based on updates received from the department relating to the implementation of the ECFS district plan for the ECFS district advisory council’s ECFS district.
   b.  Provide feedback to the department while the department is developing ECFS system policies.
   c.  Advise the department on how to best provide families access to primary prevention strategies, early intervention strategies, and ongoing family and community resources throughout the ECFS district advisory council’s ECFS district.
   4.  An ECFS district advisory council shall perform the duties required under this section regardless of whether any seat on the ECFS district advisory council is vacant.
    Sec. 4.  NEW SECTION.  234A.4  Data collection and use.
   1.  The department shall perform all of the following actions related to ECFS system data:
   a.  (1)  Collect, maintain, monitor, analyze, and utilize data, including but not limited to child welfare data, Medicaid data, ECFS system data, and other data depicting the status of children and families in the state, as necessary to issue cost estimates for serving populations, make and receive payments, conduct operations, and perform ECFS system activities.
   (2)  When performing duties under this paragraph, the department shall maintain compliance with applicable federal and state privacy laws to ensure the confidentiality and integrity of individually identifiable data.
   (3)  The department shall periodically assess the status of the department’s compliance with subparagraph (2) to ensure that data collected and maintained by the department under this paragraph is protected.
   b.  To the extent possible, establish a record for each individual receiving publicly funded ECFS system services. Each record established under this paragraph shall include a unique client identifier for the purposes of identifying and tracking the individual’s record.
   c.  Consult with department contractors and other ECFS system stakeholders on an ongoing basis relating to the administration of the ECFS system, including but not limited to reviewing trends and outcomes as indicators for improving or modifying administration of the ECFS system.
   d.  Engage with entities that maintain information the department is required to collect pursuant to this section to integrate data relating to individuals receiving ECFS system services.
   e.  Engage with entities that maintain general population data relating to the ECFS system to develop action plans, create projections relating to a population’s ECFS system needs, develop ECFS system policies, and otherwise perform activities as necessary to support families in achieving a healthy, successful future.
   2.  The department shall ensure that public and private agencies, organizations, and individuals that operate within the ECFS system use uniform methods to maintain statistical information relating to ECFS system outcomes and performance.
    Sec. 5.  NEW SECTION.  234A.5  Healthy families programs —— HOPES-HFI program.
   1.  The department may establish the HOPES-HFI program to provide services to families and children during a child’s prenatal through preschool years. If established, the HOPES-HFI program shall do all of the following:
   a.  Promote optimal child health and development.
   b.  Improve family coping skills and functioning.
   c.  Promote positive parenting skills and intrafamilial interaction.
   d.  Prevent child abuse, child neglect, infant mortality, and infant morbidity.
   2.  The department shall administer the HOPES-HFI program, in whole or in part, by contracting with local organizations that use evidence-based home visiting models.
    Sec. 6.  NEW SECTION.  234A.6  Early childhood and family services system fund.
   1.  An early childhood and family services system fund is created in the state treasury under the control of the department and consisting of any moneys appropriated to the department for the ECFS system fund’s purposes by the general assembly and any other moneys available and obtained or accepted by the department for deposit in the ECFS system fund. The ECFS system fund shall be used to implement and administer the ECFS system.
   2.  Moneys in the ECFS system fund are appropriated to the department for the purposes of implementing and administering the ECFS system.
   3.  Notwithstanding section 8.33, moneys appropriated in this section that remain unencumbered or unobligated at the close of a fiscal year shall not revert but shall remain available for expenditure for the purposes designated.
   4.  Notwithstanding section 12C.7, subsection 2, interest or earnings on moneys in the ECFS system fund shall be credited to the ECFS system fund.
    Sec. 7.  REPEAL.  Section 135.106, Code 2026, is repealed.
    Sec. 8.  EFFECTIVE DATE.  The following take effect July 1, 2027:
   1.  The sections of this division of this Act enacting sections 234A.1 through 234A.5.
   2.  The sections of this division of this Act repealing section 135.106.
    Sec. 9.  EFFECTIVE DATE.  The section of this division of this Act enacting section 234A.6, being deemed of immediate importance, takes effect upon enactment.
DIVISION II
DECATEGORIZATION INITIATIVE

    Sec. 10.  Section 235.7, subsection 2, Code 2026, is amended to read as follows:
   2.  Membership.  The department may authorize the governance boards of decategorization of child welfare and juvenile justice funding projects established under section 232.188 to appoint the transition committee membership and may utilize the boundaries of decategorization projects to establish the service areas for transition committees. The committee A committee’s membership may include but is not limited to department staff involved with foster care, child welfare, and adult services, juvenile court services staff, staff involved with county general assistance or emergency relief under chapter 251 or 252, school district and area education agency staff involved with special education, and a child’s court appointed special advocate, guardian ad litem, service providers, and other persons knowledgeable about the child.
    Sec. 11.  Section 237A.1, subsection 2, paragraph j, subparagraph (2), Code 2026, is amended by striking the subparagraph.
    Sec. 12.  Section 249A.26, subsection 5, Code 2026, is amended by striking the subsection.
    Sec. 13.  Section 256I.4, subsection 6, Code 2026, is amended by striking the subsection.
    Sec. 14.  REPEAL.  Section 232.188, Code 2026, is repealed.
DIVISION III
CHILD ABUSE PREVENTION PROGRAM

    Sec. 15.  Section 144.13A, subsection 5, paragraph a, Code 2026, is amended to read as follows:
   a.  Ten dollars of each registration fee is appropriated and shall be used for primary and secondary child abuse prevention programs pursuant to section 235A.1, and ten dollars of each registration fee is appropriated and shall be used for the congenital and inherited disorders central registry established pursuant to section 136A.6. Notwithstanding section 8.33, moneys appropriated in this paragraph that remain unencumbered or unobligated at the close of the fiscal year shall not revert but shall remain available for expenditure for the purposes designated until the close of the succeeding fiscal year, and shall not be transferred, used, obligated, appropriated, or otherwise encumbered except as provided in this paragraph.
    Sec. 16.  Section 422.12K, Code 2026, is amended to read as follows:
   422.12K  Income tax checkoff for child abuse prevention program fund.
   1.  A person who files an individual or a joint income tax return with the department of revenue under section 422.13 may designate one dollar or more to be paid to the child abuse prevention program early childhood and family services system fund created in section 235A.2 234A.6, to be used for the purpose of child abuse prevention. If the refund due on the return or the payment remitted with the return is insufficient to pay the additional amount designated by the taxpayer to the child abuse prevention program early childhood and family services system fund, the amount designated shall be reduced to the remaining amount remitted with the return. The designation of a contribution to the child abuse prevention program early childhood and family services system fund under this section is irrevocable.
   2.  The director of revenue shall draft the income tax form to allow the designation of contributions to the child abuse prevention program early childhood and family services system fund on the tax return. The department of revenue, on or before January 31, shall transfer the total amount designated on the tax return forms due in the preceding calendar year to the child abuse prevention program early childhood and family services system fund. However, before a checkoff pursuant to this section shall be permitted, all liabilities on the books of the department and accounts identified as owing under section 421.65 shall be satisfied.
   3.  The department of health and human services may authorize payment of moneys from the child abuse prevention program early childhood and family services system fund for the purpose of child abuse prevention in accordance with section 235A.2 234A.6.
   4.  The department of revenue shall adopt rules to administer this section.
   5.  This section is subject to repeal under section 422.12E.
    Sec. 17.  REPEAL.  Sections 235A.1, 235A.2, and 235A.3, Code 2026, are repealed.
    Sec. 18.  CHILD ABUSE PREVENTION PROGRAM FUND —— TRANSFER OF MONEYS.  Any unencumbered or unobligated moneys remaining in the child abuse prevention program fund created in section 235A.2, on June 30, 2026, shall be transferred to the early childhood and family services system fund created in section 234A.6, as enacted in this Act.
    Sec. 19.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
DIVISION IV
TRANSITION PROVISIONS

    Sec. 20.  EARLY CHILDHOOD AND FAMILY SERVICES SYSTEM.
   1.  For purposes of this division:
   a.  The following mean the same as defined in section 234A.1 as enacted in division I of this Act:
   (1)  “Department”.
   (2)  “Early intervention strategies”.
   (3)  “ECFS district plan”.
   (4)  “ECFS state plan”.
   (5)  “ECFS system”.
   (6)  “ECFS system fund”.
   (7)  “Ongoing family and community resources”.
   (8)  “Primary prevention strategies”.
   b.  “Early childhood Iowa area”, “early childhood Iowa area board”, and “early childhood Iowa area state board” mean the same as defined in section 256I.1.
   c.  “Early childhood Iowa initiative” means the early childhood Iowa initiative described in section 256I.2.
   d.  “Transition period” means the period beginning on the date of enactment of this division of this Act and concluding on June 30, 2027.
   2.  There is created an early childhood and family services system under the control of the department. Beginning July 1, 2027, the department shall be responsible for implementing and maintaining a statewide system of primary prevention strategies, early intervention strategies, and ongoing family and community resources through the ECFS system.
   3.  During the transition period, the department may exercise all policymaking functions and regulatory powers as necessary to establish the ECFS system as if the sections of division I of this Act enacting sections 234A.1 through 234A.5 were enacted.
   4.  The department shall perform all the following duties by the conclusion of the transition period:
   a.  Adopt rules pursuant to chapter 17A as necessary to establish, implement, and administer the ECFS system.
   b.  Establish policies as necessary to efficiently establish, implement, and administer the ECFS system.
   c.  Prepare forms necessary to establish, implement, and administer the ECFS system.
   d.  Prepare an ECFS state plan.
   e.  Develop ECFS district plans.
   f.  Develop a plan for the transition of early childhood and family services to the ECFS system.
   g.  Execute contracts as necessary to establish, implement, and administer the ECFS system.
   h.  Ensure that individuals currently receiving primary prevention strategies, early intervention strategies, services, and supports or ongoing family and community resources under the purview of the department, or home visiting services provided through the early childhood Iowa initiative, have uninterrupted continuity of care.
   i.  Submit a report to the general assembly no later than January 15, 2027, that details the administrative and operational costs to establish, implement, and administer the ECFS system.
   j.  Establish contractual rights, privileges, and responsibilities as necessary to establish, implement, and administer the ECFS system.
   k.  Develop a plan to transition oversight and accountability for home visiting services currently funded by the early childhood Iowa initiative to the ECFS system.
   l.  Work with a cohort of early childhood Iowa area directors designated by the association of early childhood Iowa area boards and advocates, and the early childhood Iowa state board, to develop a plan to modernize the early childhood Iowa initiative. The plan shall include the frequency of work sessions, engagement opportunities for early childhood Iowa partners, and mutually agreed upon deliverables including revisions to chapter 256I.
   5.  If the department determines that a federal waiver or authorization is necessary to administer any provision of this division of this Act, or to effectuate the ECFS system by the conclusion of the transition period, the department shall timely request the federal waiver or authorization. Notwithstanding any other effective date to the contrary, a provision of this division of this Act that the department determines requires a federal waiver or authorization shall be effective only upon receipt of federal approval for the waiver or authorization.
   6.  a.  All debts, claims, or other liabilities owed to an early childhood Iowa area or an early childhood Iowa area board due to home visiting services rendered pursuant to chapter 256I, Code 2026, at the conclusion of the transition period shall remain due and owing after the transition period concludes.
   b.  After the transition period concludes, all fiscal agents contracted with an early childhood Iowa area board shall collect outstanding debts, claims, or other liabilities owed to an early childhood Iowa area or an early childhood Iowa area board for home visiting services pursuant to chapter 256I provided or rendered before the transition period concluded.
   7.  With input from appropriate stakeholders, the department shall identify each home visiting services contract that will be impacted by divisions I through V of this Act. On or before June 30, 2027, each party to a contract identified by the department under this subsection shall exercise the option, if permitted under the terms of the contract, to terminate the contract. Contracts identified under this subsection that do not provide for termination shall not be renewed or extended at the end of the current contract term.
   8.  Unless otherwise provided in this division of this Act, an early childhood Iowa area, an early childhood Iowa area board, an early childhood Iowa area director, or any agent of an early childhood Iowa area or early childhood Iowa area board, and any subdivision of the state, shall not enter into, renew, or extend a home visiting services contract related to the early childhood Iowa initiative or related activities if the term of the contract would extend past, or the deliverables under the contract would be provided after, June 30, 2027.
    Sec. 21.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
DIVISION V
HEALTH AND HUMAN SERVICES DISTRICTS

    Sec. 22.  Section 217.1, Code 2026, is amended by adding the following new subsection:
   NEW SUBSECTION.  4.  “Health and human services district” or “HHS district” means a geographic, multicounty area designated by the department under section 217.1B for statewide program and service delivery.
    Sec. 23.  NEW SECTION.  217.1B  Health and human services districts.
   1.  The department shall divide the entirety of the state into designated health and human services districts. The initial HHS districts shall be the same as the behavioral health districts designated pursuant to section 225A.4, Code 2026, and that exist on the effective date of this division of this Act. The department shall review the designated HHS districts at least once every seven consecutive fiscal years.
   2.  a.  The department may modify a designated HHS district. When modifying a designated HHS district, the department shall consider all of the following:
   (1)  City and county boundaries.
   (2)  The population size that can be effectively served in a specific area.
   (3)  Areas of high need for services.
   (4)  Patterns various populations exhibit when accessing or receiving services.
   b.  Notwithstanding chapter 17A, the manner in which the modification of an HHS district is made, including the determination of boundaries for a modified HHS district, shall not be subject to judicial review.
   3.  The department shall adopt rules pursuant to chapter 17A to administer this section.
    Sec. 24.  CONTINGENT EFFECTIVE DATE.  This division of this Act takes effect July 1, 2026, unless the sections of 2026 Iowa Acts, LSB 5558 XD, or successor legislation, amending section 217.1 and enacting section 217.1B are enacted on or before July 1, 2026.
DIVISION VI
CONFORMING CHANGES

    Sec. 25.  Section 232.69, subsection 1, paragraph b, subparagraph (5), Code 2026, is amended to read as follows:
   (5)  An employee or operator of a licensed child care center, registered child development home, head start program, family development and self-sufficiency grant program under section 216A.107, or healthy opportunities for parents to experience success – healthy families Iowa program under section 135.106 234A.5.
    Sec. 26.  Section 237A.30, subsection 1, Code 2026, is amended to read as follows:
   1.  The department shall work with the early childhood Iowa program established in section 256I.5 in designing and implementing implement a voluntary quality rating system for each provider type of child care facility.
    Sec. 27.  Section 256I.3, subsection 2, paragraph b, Code 2026, is amended to read as follows:
   b.  The governor’s appointees shall be selected from individuals nominated by area boards. The nominations shall reflect the range of interests represented on the area boards so that the governor is able to appoint one or more members each for early care, education, health, human services, business, faith, and public interests. At least one of the citizen members shall be a service consumer or the parent of a service consumer. The term of office of the citizen members is three years. A citizen member vacancy on the board shall be filled in the same manner as the original appointment for the balance of the unexpired term.
    Sec. 28.  Section 256I.13, subsection 1, Code 2026, is amended to read as follows:
   1.  In order to implement the legislative intent stated in sections 135.106 and section 256I.9, that priority for family support program funding be given to programs using evidence-based or promising models for family support, it is the intent of the general assembly that ninety percent of state funds expended for family support programs shall be used for evidence-based or promising program models. The remaining ten percent of funds may be used for innovative program models that do not yet meet the definition of evidence-based or promising programs.
    Sec. 29.  EFFECTIVE DATE.  This division of this Act takes effect July 1, 2027.
DIVISION VII
CHILD CARE WORKFORCE —— STATE CHILD CARE ASSISTANCE ELIGIBILITY

    Sec. 30.  NEW SECTION.  237A.15  State child care assistance —— child care workforce eligibility.
   1.  Notwithstanding any provision of section 237A.13 or 237A.14 to the contrary, a child shall be eligible for the state child care assistance program established in section 237A.13 and the state child care assistance graduated eligibility phase-out program established in section 237A.14 if a parent, guardian, or custodian of the child meets all of the following requirements, as applicable:
   a.  The parent, guardian, or custodian is employed in this state at a child care facility or child care home that has an agreement with the department to accept reimbursements from the state child care assistance program.
   b.  The parent, guardian, or custodian works an average minimum of thirty-two hours per week. A portion of the hours worked, as specified by the department, must be in a position with a primary duty of providing child care directly to children, and the parent’s, guardian’s, or custodian’s position must be regularly counted in the minimum child-to-staff ratio established by the department.
   c.  (1)  If the parent, guardian, or custodian is employed at a child care home or a child development home, the parent, guardian, or custodian does not provide child care to the parent’s, guardian’s, or custodian’s own child.
   (2)  Notwithstanding subparagraph (1), a co-provider at a child development home may qualify for state child care assistance if the co-provider meets all requirements specified in this section and by the department by rule.
   d.  The parent, guardian, or custodian is not a substitute or an assistant at a child care home or a child development home.
   e.  Based on the department’s evaluation of the parent’s, guardian’s, or custodian’s application for state child care assistance, the department has determined the parent, guardian, or custodian has a need for child care.
   f.  The parent, guardian, or custodian is not the owner of the child care facility or child care home where any of the parent’s, guardian’s, or custodian’s children are enrolled.
   2.  A child of a director, co-director, or other administrative staff member of a child care facility may qualify for state child care assistance under subsection 1 if the director, co-director, or other administrative staff member is regularly counted in the minimum child-to-staff ratio established by the department by rule.
   3.  A parent, guardian, or custodian of a child participating in the state child care assistance program based on eligibility established under this section shall make copayments as specified by the department by rule.
   4.  The department shall adopt rules pursuant to chapter 17A to administer this section.
    Sec. 31.  EMERGENCY RULES.  The department of health and human services may adopt emergency rules under section 17A.4, subsection 3, and section 17A.5, subsection 2, paragraph “b”, to implement the provisions of this division of this Act and the rules shall be effective immediately upon filing unless a later date is specified in the rules. Any rules adopted in accordance with this section shall also be published as a notice of intended action as provided in section 17A.4.
    Sec. 32.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
DIVISION VIII
CODE EDITOR DIRECTIVES

    Sec. 33.  CODE EDITOR DIRECTIVES.  The Code editor is directed to do all of the following:
   1.  Make changes in any Code sections amended or enacted by any other Act to correspond with the changes made in this Act if there appears to be no doubt as to the proper method of making the changes and the changes would not be contrary to or inconsistent with the purposes of this Act or any other Act.
   2.  Correct internal references in the Code and in enacted legislation as necessary due to the enactment of this Act.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to early childhood and family services, including creation of an early childhood and family services (ECFS) system and child care workforce eligibility for state child care assistance (CCA).
   DIVISION I —— EARLY CHILDHOOD AND FAMILY SERVICES SYSTEM.  The bill creates new Code chapter 234A (early childhood and family services system). The purpose of the ECFS system is to provide accessible, ongoing, and community-based services for children and families. The bill defines terms used in the chapter.
   The ECFS system is established under the control of the department of health and human services (HHS) and ECFS districts (districts) are established for statewide implementation of primary prevention strategies and early intervention strategies for families and their children under 19 years of age. The ECFS system must be administered in a manner that maximizes funding opportunities, interagency collaboration, and integration of activities and services that support positive outcomes for children and families. 
   The bill details actions HHS must perform, to the extent funding is available, to develop and administer the ECFS system.
   The bill directs HHS to establish an ECFS district advisory council (council) in each district, and develop policies and procedures for the operational functions of the councils. A council shall consist of 10 members appointed by HHS. The bill specifies individuals who are eligible for appointment, and the duties of a council.
   The bill specifies the duties of HHS related to data collection and use for the ECFS system. The bill requires HHS to maintain compliance with applicable federal and state privacy laws to ensure the confidentiality and integrity of individually identifiable data related to the ECFS system collected by HHS.
   Current Code section 135.106 (healthy opportunities for parents to experience success – healthy families Iowa (HOPES-HFI)) is placed in the new Code chapter and becomes part of the ECFS system. The bill specifies the requirements for the HOPES-HFI program and directs HHS to develop and administer the HOPES-HFI program, in whole or in part, by contracting with local organizations that use evidence-based home visiting models.
   The bill establishes an ECFS system fund (ECFS fund) consisting of moneys appropriated to HHS for the ECFS fund’s purposes by the general assembly and any other moneys available and obtained or accepted by HHS for deposit in the ECFS fund. Moneys in the ECFS fund are appropriated to HHS for the purposes of implementing and administering the ECFS system. Moneys appropriated that remain unencumbered or unobligated at the close of a fiscal year shall not revert to the general fund of the state, and interest or earnings on moneys in the fund shall be credited to the ECFS fund.
   The section of the division that establishes the ECFS fund takes effect upon enactment. All other sections in the division take effect July 1, 2027.
   DIVISION II —— DECATEGORIZATION INITIATIVE. The bill eliminates the decategorization initiative.
   DIVISION III —— CHILD ABUSE PREVENTION PROGRAM. The bill eliminates the child abuse prevention program, fund, and advisory committee. A taxpayer may still receive a nonrefundable reduction in the taxpayer’s income taxes for contributing one or more dollars to child abuse prevention, but the moneys received will be administered through the ECFS system instead of the child abuse prevention program fund. Funding for child abuse prevention and moneys in the current child abuse prevention fund are directed to the ECFS fund to be used by HHS for child abuse prevention.
   This division of the bill takes effect upon enactment.
   DIVISION IV —— TRANSITION PROVISIONS. The bill defines terms used in the division, including “transition period”, which means the period beginning on the date of enactment of the division and concluding on June 30, 2027.
   The bill allows HHS to exercise all policymaking functions and regulatory powers as necessary to establish the ECFS system during the transition period.
   The bill requires HHS to execute contracts as necessary to establish, implement, and administer the ECFS system; adopt necessary administrative rules; establish necessary policies and prepare necessary forms; prepare an ECFS state plan and develop ECFS district plans; develop plans for the transition of early childhood and family services to the ECFS system; ensure that individuals currently receiving ECFS system-related services under the purview of HHS or home visiting services provided through the initiative have uninterrupted continuity of care; submit a report to the general assembly no later than January 15, 2027, that details the administrative and operational costs to establish, implement, and administer the ECFS system; develop a plan to transition oversight and accountability for home visiting services currently funded by the early childhood Iowa initiative to the ECFS system; and work with a cohort of early childhood Iowa area directors and the early childhood Iowa state board to develop a plan to modernize the early childhood Iowa initiative. 
   The bill requires HHS to request any federal waivers or authorizations (waivers) necessary to implement the ECFS system. Notwithstanding other effective dates stated in the bill, any provision of the bill HHS determines necessitates a waiver is effective upon receipt of the federal approval of the waiver.
   The bill provides that all debts, claims, or other liabilities owed to an early childhood Iowa area (area) or an area board due to home visiting services rendered pursuant to Code chapter 256I at the conclusion of the transition period shall remain due and owing after the transition period concludes. After the transition period concludes, all fiscal agents contracted with an area board shall assist collect outstanding debts, claims, or other liabilities owed to the areas or area boards for home visiting services provided or rendered before the transition period concluded. Reimbursement for allowable activities and services shall only be paid if accompanied by sufficient supporting documentation.
   With input from appropriate stakeholders, the bill requires HHS to identify each home visiting contract that will be impacted by the provisions relating to the ECFS system and the initiative. On or before June 30, 2027, each party to a contract identified by HHS shall exercise the option, if available pursuant to the terms of the contract, to terminate the contract. Contracts that do not provide for termination shall not be renewed or extended at the end of the current contract term.
   An area board, an area director, or any agent of an area or area board, and any subdivision of the state, shall not enter into, renew, or extend a home visiting services contract related to the initiative or related activities if the term period of the contract would extend, or the deliverables under the contract would be provided, beyond June 30, 2027.
   This division of the bill takes effect upon enactment.
   DIVISION V —— HEALTH AND HUMAN SERVICES DISTRICTS. The bill directs HHS to divide the state into health and human services districts (districts), as that term is defined in the bill, to be used by HHS for statewide delivery of programs and services. The initial district boundaries shall be the same as the behavioral health district boundaries, as the behavioral health district boundaries existed on July 1, 2025. HHS must review the designation of the districts at least once every seven consecutive fiscal years. The bill provides factors HHS must consider when modifying a district, and modification is not subject to judicial review.
   This division of the bill is effective July 1, 2026, unless the sections of 2026 Iowa Acts, LSB 5558 XD, amending Code section 217.1 and enacting Code section 217.1B are enacted on or before July 1, 2026.
   DIVISION VI —— CONFORMING CHANGES. The bill includes conforming changes and this division takes effect July 1, 2027.
   DIVISION VII —— CHILD CARE WORKFORCE —— STATE CHILD CARE ASSISTANCE ELIGIBILITY. The bill provides that a child shall be eligible for the state child care assistance (CCA) program under Code section 237A.13 (state child care assistance) or 237A.14 (child care assistance —— graduated eligibility phase-out) if a parent, guardian, or custodian (custodian) is employed at a child care facility or child care home that has an agreement with HHS to accept reimbursement from the CCA program; works an average minimum of 32 hours per week in a position with a primary duty of providing child care directly to children; and meets several other requirements specified in the bill. A child of a director, co-director, or other administrative staff member (staff member) may be eligible if the staff member is regularly counted in the child-to-staff ratio established by the department. A custodian of a child participating in the CCA program under the bill shall make copayments as specified by HHS by rule.
   The bill requires HHS to adopt rules to administer this division of the bill. The division provides HHS with emergency rulemaking authority. This division of the bill takes effect upon enactment.
   DIVISION VIII —— CODE EDITOR DIRECTIVES. The bill provides Code editor directives.