Senate File 353 - Introduced SENATE FILE 353 BY PETERSEN , WINCKLER , DONAHUE , STAED , BLAKE , TRONE GARRIOTT , BENNETT , DOTZLER , ZIMMER , TOWNSEND , and CELSI A BILL FOR An Act relating to state child care assistance income 1 eligibility requirements, and child care provider 2 reimbursement rates. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1799XS (6) 91 dg/ko

S.F. 353 Section 1. Section 237A.13, subsection 2, paragraph a, Code 1 2025, is amended to read as follows: 2 a. (1) (a) One On or before June 30, 2025, one hundred 3 sixty percent of the federal poverty level applicable to the 4 family size for children needing basic care. 5 (b) Beginning July 1, 2025, and ending June 30, 2026, one 6 hundred seventy percent of the federal poverty level applicable 7 to the family size for children needing basic care. 8 (c) Beginning July 1, 2026, and ending June 30, 2027, one 9 hundred eighty percent of the federal poverty level applicable 10 to the family size for children needing basic care. 11 (d) Beginning July 1, 2027, and ending June 30, 2028, one 12 hundred ninety percent of the federal poverty level applicable 13 to the family size for children needing basic care. 14 (e) On or after July 1, 2028, two hundred percent of 15 the federal poverty level applicable to the family size for 16 children needing basic care. 17 (2) (a) Two On or before June 30, 2025, two hundred percent 18 of the federal poverty level applicable to the family size for 19 children needing special needs care. 20 (b) Beginning July 1, 2025, and ending June 30, 2026, two 21 hundred ten percent of the federal poverty level applicable to 22 the family size for children needing special needs care. 23 (c) Beginning July 1, 2026, and ending June 30, 2027, two 24 hundred twenty percent of the federal poverty level applicable 25 to the family size for children needing special needs care. 26 (d) Beginning July 1, 2027, and ending June 30, 2028, two 27 hundred thirty percent of the federal poverty level applicable 28 to the family size for children needing special needs care. 29 (e) Beginning July 1, 2028, and ending June 30, 2029, two 30 hundred forty percent of the federal poverty level applicable 31 to the family size for children needing special needs care. 32 Sec. 2. Section 237A.13, subsection 4, Code 2025, is amended 33 to read as follows: 34 4. a. The department shall set reimbursement rates as 35 -1- LSB 1799XS (6) 91 dg/ko 1/ 3

S.F. 353 authorized by appropriations enacted for payment of the 1 reimbursements. The department shall conduct a statewide 2 reimbursement rate survey to compile information on each 3 county , and the survey shall be conducted at least every two 4 years. The department shall set rates in a manner so as to 5 provide incentives for an unregistered provider to become 6 registered. 7 b. The department shall not modify set reimbursement rates 8 to for the state child care assistance program or financial 9 eligibility requirements for a family participating in the 10 state child care assistance program without prior enabling 11 legislation in this state passed on or after January 1, 2023 at 12 rates no less than the sixty-fifth percentile, but no more than 13 the eightieth percentile, of the rates child care providers 14 charge private pay customers as reported in the most recently 15 completed statewide reimbursement rate survey . 16 EXPLANATION 17 The inclusion of this explanation does not constitute agreement with 18 the explanation’s substance by the members of the general assembly. 19 This bill relates to the state child care assistance (CCA) 20 program income eligibility requirements and child care provider 21 (provider) reimbursement rates. 22 Under current law, for a child to be eligible for entry into 23 the CCA program, the child’s family must have income below 160 24 percent of the federal poverty level (FPL) applicable to a 25 family’s size for a child needing basic care, or 200 percent 26 of the FPL for a child needing special needs care. The bill 27 increases the CCA program income eligibility limit for children 28 needing basic care to 170 percent of the FPL for FY 2025-2026; 29 180 percent of the FPL for FY 2026-2027; 190 percent of the FPL 30 for FY 2027-2028; and 200 percent of the FPL on or after July 1, 31 2028. The bill increases the CCA program income eligibility 32 limit for children needing special needs care to 210 percent 33 of the FPL for FY 2025-2026; 220 percent of the FPL for FY 34 2026-2027; 230 percent of the FPL for FY 2027-2028; and 240 35 -2- LSB 1799XS (6) 91 dg/ko 2/ 3

S.F. 353 percent of the FPL on or after July 1, 2028. 1 The reimbursement rates paid to providers under the CCA 2 program are based on statewide reimbursement rate surveys that 3 the department of health and human services (HHS) conducts at 4 least every two years to collect data on providers’ private pay 5 rates. Under current law, CCA reimbursement rates must be set 6 at rates no less than the 65th percentile, but no more than the 7 80th percentile, of rates child care providers charge private 8 pay customers as reported in the 2020 statewide reimbursement 9 rate survey. The bill requires HHS to base CCA reimbursement 10 rates on the most recently completed statewide reimbursement 11 rate survey. 12 -3- LSB 1799XS (6) 91 dg/ko 3/ 3