1.1 	A bill for an act
1.2 	relating to human services; forecasting the basic sliding fee child care assistance 
1.3 	program; modifying child care assistance provider reimbursement rates; 
1.4 	appropriating money;amending Minnesota Statutes 2016, sections 119B.02, 
1.5 	subdivisions 1, 2; 119B.03, subdivision 9; 119B.05, subdivision 5; 119B.08, 
1.6 	subdivision 3; 119B.09, subdivision 4a; 256.017, subdivision 9; Minnesota Statutes 
1.7 	2017 Supplement, sections 119B.011, subdivision 19b; 119B.05, subdivision 1; 
1.8 	119B.09, subdivision 1; 119B.13, subdivision 1; repealing Minnesota Statutes 
1.9 	2016, sections 119B.03, subdivisions 1, 2, 5, 6, 6a, 6b, 8; 119B.09, subdivision 3; 
1.10 	Minnesota Statutes 2017 Supplement, sections 119B.011, subdivision 20a; 119B.03, 
1.11 	subdivision 4; Minnesota Rules, parts 3400.0020, subpart 8; 3400.0030; 3400.0060, 
1.12 	subparts 2, 4, 6, 6a, 7; 3400.0140, subpart 10; 3400.0183, subpart 1.
1.13 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.14 	Section 1. Minnesota Statutes 2017 Supplement, section 119B.011, subdivision 19b, is 
1.15 	amended to read:
1.16 		Subd. 19b.Student parent. "Student parent" means a person who is:
1.17 	(1) under 21 years of age and has a child;
1.18 	(2) pursuing a high school diploma or commissioner of education-selected high school 
1.19 	equivalency certification; and
1.20 	(3) residing within a county that has a basic sliding fee waiting list under section 119B.03, 
1.21 	subdivision 4; and
1.22 	(4) (3) not an MFIP participant.

2.1 	Sec. 2. Minnesota Statutes 2016, section 119B.02, subdivision 1, is amended to read:
2.2 		Subdivision 1.Child care services. The commissioner shall develop standards for county 
2.3 	and human services boards to provide child care services to enable eligible families to 
2.4 	participate in employment, training, or education programs. Within the limits of available 
2.5 	appropriations, The commissioner shall distribute money to counties to reduce the costs of 
2.6 	child care for eligible families. The commissioner shall adopt rules to govern the program 
2.7 	in accordance with this section. The rules must establish a sliding schedule of fees for parents 
2.8 	receiving child care services. The rules shall provide that funds received as a lump-sum 
2.9 	payment of child support arrearages shall not be counted as income to a family in the month 
2.10 	received but shall be prorated over the 12 months following receipt and added to the family 
2.11 	income during those months. The commissioner shall maximize the use of federal money 
2.12 	under title I and title IV of Public Law 104-193, the Personal Responsibility and Work 
2.13 	Opportunity Reconciliation Act of 1996, and other programs that provide federal or state 
2.14 	reimbursement for child care services for low-income families who are in education, training, 
2.15 	job search, or other activities allowed under those programs. Money appropriated under 
2.16 	this section must be coordinated with the programs that provide federal reimbursement for 
2.17 	child care services to accomplish this purpose. Federal reimbursement obtained must be 
2.18 	allocated to the county that spent money for child care that is federally reimbursable under 
2.19 	programs that provide federal reimbursement for child care services. The counties
2.20 	commissioner shall use the federal money to expand child care services. The commissioner 
2.21 	may adopt rules under chapter 14 to implement and coordinate federal program requirements.

2.22 	Sec. 3. Minnesota Statutes 2016, section 119B.02, subdivision 2, is amended to read:
2.23 		Subd. 2.Contractual agreements with tribes. The commissioner may enter into 
2.24 	contractual agreements with a federally recognized Indian tribe with a reservation in 
2.25 	Minnesota to carry out the responsibilities of county human service agencies to the extent 
2.26 	necessary for the tribe to operate child care assistance programs under sections 119B.03
2.27 	and 119B.05. An agreement may allow the state to make payments for child care assistance 
2.28 	services provided under sectionsections 119B.03 and 119B.05. The commissioner shall 
2.29 	consult with the affected county or counties in the contractual agreement negotiations, if 
2.30 	the county or counties wish to be included, in order to avoid the duplication of county and 
2.31 	tribal child care services. Funding to support services under section 119B.03 may be 
2.32 	transferred to the federally recognized Indian tribe with a reservation in Minnesota from 
2.33 	allocations available to counties in which reservation boundaries lie. When funding is 
2.34 	transferred under section 119B.03, the amount shall be commensurate to estimates of the 
3.1 	proportion of reservation residents with characteristics identified in section 119B.03, 
3.2 	subdivision 6, to the total population of county residents with those same characteristics.

3.3 	Sec. 4. Minnesota Statutes 2016, section 119B.03, subdivision 9, is amended to read:
3.4 		Subd. 9.Portability pool. (a) The commissioner shall establish a pool of up to five 
3.5 	percent of the annual appropriation for the basic sliding fee program to provide continuous 
3.6 	child care assistance for eligible families who move between Minnesota counties. At the 
3.7 	end of each allocation period, any unspent funds in the portability pool must be used for 
3.8 	assistance under the basic sliding fee program. If expenditures from the portability pool 
3.9 	exceed the amount of money available, the reallocation pool must be reduced to cover these 
3.10 	shortages.
3.11 	(b) To be eligible for portable basic sliding fee assistance, A family that has moved from 
3.12 	a county in which it (a) A family receiving child care assistance under the child care fund 
3.13 	that has moved from a county in which the family was receiving basic sliding feechild care 
3.14 	assistance to aanother county with a waiting list for the basic sliding fee program must be 
3.15 	admitted into the receiving county's child care assistance program if the family:
3.16 	(1) meetmeets the income and eligibility guidelines for the basic sliding fee program; 
3.17 	and
3.18 	(2) notifynotifies the new county of residence within 60 days of moving and submit
3.19 	submits information to the new county of residence to verify eligibility for the basic sliding 
3.20 	fee program.
3.21 	(c)(b) The receiving county must:
3.22 	(1) accept administrative responsibility for applicants for portable basic sliding fee 
3.23 	assistance at the end of the two months of assistance under the Unitary Residency Act;.
3.24 	(2) continue basic sliding fee assistance for the lesser of six months or until the family 
3.25 	is able to receive assistance under the county's regular basic sliding program; and
3.26 	(3) notify the commissioner through the quarterly reporting process of any family that 
3.27 	meets the criteria of the portable basic sliding fee assistance pool.

3.28 	Sec. 5. Minnesota Statutes 2017 Supplement, section 119B.05, subdivision 1, is amended 
3.29 	to read:
3.30 		Subdivision 1.Eligible participants. Families eligible for child care assistance under 
3.31 	the MFIP child care program are:
4.1 	(1) MFIP participants who are employed or in job search and meet the requirements of 
4.2 	section 119B.10;
4.3 	(2) persons who are members of transition year families under section 119B.011, 
4.4 	subdivision 20, and meet the requirements of section 119B.10;
4.5 	(3) families who are participating in employment orientation or job search, or other 
4.6 	employment or training activities that are included in an approved employability development 
4.7 	plan under section 256J.95;
4.8 	(4) MFIP families who are participating in work job search, job support, employment, 
4.9 	or training activities as required in their employment plan, or in appeals, hearings, 
4.10 	assessments, or orientations according to chapter 256J;
4.11 	(5) MFIP families who are participating in social services activities under chapter 256J 
4.12 	as required in their employment plan approved according to chapter 256J;
4.13 	(6) families who are participating in services or activities that are included in an approved 
4.14 	family stabilization plan under section 256J.575;
4.15 	(7) families who are participating in programs as required in tribal contracts under section 
4.16 	119B.02, subdivision 2, or 256.01, subdivision 2;
4.17 	(8) families who are participating in the transition year extension under section 119B.011, 
4.18 	subdivision 20a;
4.19 	(9) (8) student parents as defined under section 119B.011, subdivision 19b; and
4.20 	(10)(9) student parents who turn 21 years of age and who continue to meet the other 
4.21 	requirements under section 119B.011, subdivision 19b. A student parent continues to be 
4.22 	eligible until the student parent is approved for basic sliding fee child care assistance or 
4.23 	until the student parent's redetermination, whichever comes first. At the student parent's 
4.24 	redetermination, if the student parent was not approved for basic sliding fee child care 
4.25 	assistance, a student parent's eligibility ends following a 15-day adverse action notice.

4.26 	Sec. 6. Minnesota Statutes 2016, section 119B.05, subdivision 5, is amended to read:
4.27 		Subd. 5.Federal reimbursement. Counties and the state shall maximize their federal 
4.28 	reimbursement under federal reimbursement programs for money spent for persons eligible 
4.29 	under this chapter. The commissioner shall allocate any federal earnings to the county to 
4.30 	be used to expand child care services under this chapter.

5.1 	Sec. 7. Minnesota Statutes 2016, section 119B.08, subdivision 3, is amended to read:
5.2 		Subd. 3.Child care fund plan. The county and designated administering agency shall 
5.3 	submit a biennial child care fund plan to the commissioner. The commissioner shall establish 
5.4 	the dates by which the county must submit the plans. The plan shall include:
5.5 	(1) a description of strategies to coordinate and maximize public and private community 
5.6 	resources, including school districts, health care facilities, government agencies, 
5.7 	neighborhood organizations, and other resources knowledgeable in early childhood 
5.8 	development, in particular to coordinate child care assistance with existing community-based 
5.9 	programs and service providers including child care resource and referral programs, early 
5.10 	childhood family education, school readiness, Head Start, local interagency early intervention 
5.11 	committees, special education services, early childhood screening, and other early childhood 
5.12 	care and education services and programs to the extent possible, to foster collaboration 
5.13 	among agencies and other community-based programs that provide flexible, family-focused 
5.14 	services to families with young children and to facilitate transition into kindergarten. The 
5.15 	county must describe a method by which to share information, responsibility, and 
5.16 	accountability among service and program providers;
5.17 	(2) a description of procedures and methods to be used to make copies of the proposed 
5.18 	state plan reasonably available to the public, including members of the public particularly 
5.19 	interested in child care policies such as parents, child care providers, culturally specific 
5.20 	service organizations, child care resource and referral programs, interagency early 
5.21 	intervention committees, potential collaborative partners and agencies involved in the 
5.22 	provision of care and education to young children, and allowing sufficient time for public 
5.23 	review and comment; and
5.24 	(3) information as requested by the department to ensure compliance with the child care 
5.25 	fund statutes and rules promulgated by the commissioner.
5.26 	The commissioner shall notify counties within 90 days of the date the plan is submitted 
5.27 	whether the plan is approved or the corrections or information needed to approve the plan. 
5.28 	The commissioner shall withhold a county's allocation until it has an approved plan. Plans 
5.29 	not approved by the end of the second quarter after the plan is due may result in a 25 percent 
5.30 	reduction in allocation. Plans not approved by the end of the third quarter after the plan is 
5.31 	due may result in a 100 percent reduction in the allocation to the county  administrative 
5.32 	payments to a county until the county has an approved plan. Counties are to maintain services 
5.33 	despite any reduction in their allocationwithholding of administrative payments due to 
5.34 	plans not being approved.

6.1 	Sec. 8. Minnesota Statutes 2017 Supplement, section 119B.09, subdivision 1, is amended 
6.2 	to read:
6.3 		Subdivision 1.General eligibility requirements. (a) Child care services must be 
6.4 	available to families who need child care to find or keep employment or to obtain the training 
6.5 	or education necessary to find employment and who:
6.6 	(1) have household income less than or equal to 67 percent of the state median income, 
6.7 	adjusted for family size, at application and redetermination, and meet the requirements of 
6.8 	section 119B.05; receive MFIP assistance; and are participating in employment and training 
6.9 	services under chapter 256J; or
6.10 	(2) have household income less than or equal to 4760 percent of the state median income, 
6.11 	adjusted for family size, at application and less than or equal to 67 percent of the state 
6.12 	median income, adjusted for family size, at redetermination.
6.13 	(b) Child care services must be made available as in-kind services.
6.14 	(c) All applicants for child care assistance and families currently receiving child care 
6.15 	assistance must be assisted and required to cooperate in establishment of paternity and 
6.16 	enforcement of child support obligations for all children in the family at application and 
6.17 	redetermination as a condition of program eligibility. For purposes of this section, a family 
6.18 	is considered to meet the requirement for cooperation when the family complies with the 
6.19 	requirements of section 256.741.
6.20 	(d) All applicants for child care assistance and families currently receiving child care 
6.21 	assistance must pay the co-payment fee under section 119B.12, subdivision 2, as a condition 
6.22 	of eligibility. The co-payment fee may include additional recoupment fees due to a child 
6.23 	care assistance program overpayment.

6.24 	Sec. 9. Minnesota Statutes 2016, section 119B.09, subdivision 4a, is amended to read:
6.25 		Subd. 4a.Temporary ineligibility of military personnel. Counties must reserve a 
6.26 	family's position under the child care assistance fund if a family has been receiving child 
6.27 	care assistance but is temporarily ineligible for assistance due to increased income from 
6.28 	active military service. Activated military personnel may be temporarily ineligible until 
6.29 	deactivation. A county must reserve a military family's position on the basic sliding fee 
6.30 	waiting list under the child care assistance fund if a family is approved to receive child care 
6.31 	assistance and reaches the top of the waiting list but is temporarily ineligible for assistance.

7.1 	Sec. 10. Minnesota Statutes 2017 Supplement, section 119B.13, subdivision 1, is amended 
7.2 	to read:
7.3 		Subdivision 1.Subsidy restrictions. (a) Beginning February 3, 2014, The maximum 
7.4 	rate paid for child care assistance in any county or county price cluster under the child care 
7.5 	fund shall be the greater of the 25th75th percentile of the 2011 most recent child care 
7.6 	provider rate survey under section 119B.02, subdivision 7, or the maximum rate effective 
7.7 	November 28, 2011 rates in effect at the time of the update. The first maximum rate update 
7.8 	must be based on the 2018 rate survey and take effect February 22, 2019. The second 
7.9 	maximum rate update must be based on the 2020 rate survey and take effect February 23, 
7.10 	2021. Thereafter, maximum rate updates take effect February 22 in the year following the 
7.11 	most recent rate survey. For a child care provider located within the boundaries of a city 
7.12 	located in two or more of the counties of Benton, Sherburne, and Stearns, the maximum 
7.13 	rate paid for child care assistance shall be equal to the maximum rate paid in the county 
7.14 	with the highest maximum reimbursement rates or the provider's charge, whichever is less. 
7.15 	The commissioner may: (1) assign a county with no reported provider prices to a similar 
7.16 	price cluster; and (2) consider county level access when determining final price clusters.
7.17 	(b) A rate which includes a special needs rate paid under subdivision 3 may be in excess 
7.18 	of the maximum rate allowed under this subdivision.
7.19 	(c) The department shall monitor the effect of this paragraph on provider rates. The 
7.20 	county shall pay the provider's full charges for every child in care up to the maximum 
7.21 	established. The commissioner shall determine the maximum rate for each type of care on 
7.22 	an hourly, full-day, and weekly basis, including special needs and disability care.
7.23 	(d) If a child uses one provider, the maximum payment for one day of care must not 
7.24 	exceed the daily rate. The maximum payment for one week of care must not exceed the 
7.25 	weekly rate.
7.26 	(e) If a child uses two providers under section 119B.097, the maximum payment must 
7.27 	not exceed:
7.28 	(1) the daily rate for one day of care;
7.29 	(2) the weekly rate for one week of care by the child's primary provider; and
7.30 	(3) two daily rates during two weeks of care by a child's secondary provider.
7.31 	(f) Child care providers receiving reimbursement under this chapter must not be paid 
7.32 	activity fees or an additional amount above the maximum rates for care provided during 
7.33 	nonstandard hours for families receiving assistance.
8.1 	(g) If the provider charge is greater than the maximum provider rate allowed, the parent 
8.2 	is responsible for payment of the difference in the rates in addition to any family co-payment 
8.3 	fee.
8.4 	(h) All maximum provider rates changes shall be implemented on the Monday following 
8.5 	the effective date of the maximum provider rate.
8.6 	(i) Notwithstanding Minnesota Rules, part 3400.0130, subpart 7, maximum registration 
8.7 	fees in effect on January 1, 2013, shall remain in effect.

8.8 	EFFECTIVE DATE. This section is effective February 22, 2019.

8.9 	Sec. 11. Minnesota Statutes 2016, section 256.017, subdivision 9, is amended to read:
8.10 		Subd. 9.Timing and disposition of penalty and case disallowance funds. Quality 
8.11 	control case penalty and administrative penalty amounts shall be disallowed or withheld 
8.12 	from the next regular reimbursement made to the county agency for state and federal benefit 
8.13 	reimbursements and federal administrative reimbursements for all programs covered in this 
8.14 	section, according to procedures established in statute, but shall not be imposed sooner than 
8.15 	30 calendar days from the date of written notice of such penalties. Except for penalties 
8.16 	withheld under the child care assistance program, all penalties must be deposited in the 
8.17 	county incentive fund provided in section 256.018. Penalties withheld under the child care 
8.18 	assistance program shall be reallocated to counties using the allocation formula under section 
8.19 	119B.03, subdivision 5. All penalties must be imposed according to this provision until a 
8.20 	decision is made regarding the status of a written exception. Penalties must be returned to 
8.21 	county agencies when a review of a written exception results in a decision in their favor.

8.22 	Sec. 12. DIRECTION TO COMMISSIONER OF MANAGEMENT AND BUDGET.
 8.23 	The state obligation for the basic sliding fee child care assistance program under 
8.24 	Minnesota Statutes, section 119B.03, must be included in the Minnesota Management and 
8.25 	Budget February and November forecast of state revenues and expenditures under Minnesota 
8.26 	Statutes, section 16A.103, beginning with the November 2018 forecast.

8.27 	Sec. 13. APPROPRIATION.
 8.28 	$....... in fiscal year 2019 is appropriated from the general fund to the commissioner of 
8.29 	human services for purposes of the Teacher Education and Compensation Helps (T.E.A.C.H.) 
8.30 	and Retaining Early Educators Through Attaining Incentives Now (R.E.E.T.A.I.N.) programs. 
8.31 	Child care professionals are eligible for awards annually.

9.1 	Sec. 14.  REPEALER.
 9.2 	(a) Minnesota Statutes 2016, sections 119B.03, subdivisions 1, 2, 5, 6, 6a, 6b, and 8; 
9.3 	and 119B.09, subdivision 3, are repealed.
9.4 	(b) Minnesota Statutes 2017 Supplement, sections 119B.011, subdivision 20a; and 
9.5 	119B.03, subdivision 4, are repealed.
9.6 	(c) Minnesota Rules, parts 3400.0020, subpart 8; 3400.0030; 3400.0060, subparts 2, 4, 
9.7 	6, 6a, and 7; 3400.0140, subpart 10; and 3400.0183, subpart 1, are repealed.

APPENDIX 

Repealed Minnesota Statutes: 18-6631 

119B.011 DEFINITIONS.Subd. 20a.Transition year extension families. 
"Transition year extension families" means families who have completed their transition year of child care assistance under this subdivision and who are eligible for, but on a waiting list for, services under section 119B.03. For purposes of sections 119B.03, subdivision 3, and 119B.05, subdivision 1, clause (2), families participating in extended transition year shall not be considered transition year families. Notwithstanding Minnesota Rules, parts 3400.0040, subpart 10, and 3400.0090, subpart 2, transition year extension child care may be used to support employment, approved education or training programs, or a job search that meets the requirements of section 119B.10 for the length of time necessary for families to be moved from the basic sliding fee waiting list into the basic sliding fee program. 

119B.03 BASIC SLIDING FEE PROGRAM.Subdivision 1. Notice of allocation. 
By October 1 of each year, the commissioner shall notify all counties of their final child care fund program allocation. 

Subd. 2.Waiting list. 
Each county that receives funds under this section must keep a written record and report to the commissioner the number of eligible families who have applied for a child care subsidy or have requested child care assistance. Counties shall perform a preliminary determination of eligibility when a family requests child care assistance. At a minimum, a county must make a preliminary determination of eligibility based on family size, income, and authorized activity. A family seeking child care assistance must provide the required information to the county. A family that appears to be eligible must be put on a waiting list if funds are not immediately available. The waiting list must identify students in need of child care. Counties must review and update their waiting list at least every six months. 

Subd. 4.Funding priority. 
(a) First priority for child care assistance under the basic sliding fee program must be given to eligible non-MFIP families who do not have a high school diploma or commissioner of education-selected high school equivalency certification or who need remedial and basic skill courses in order to pursue employment or to pursue education leading to employment and who need child care assistance to participate in the education program. This includes student parents as defined under section 119B.011, subdivision 19b. Within this priority, the following subpriorities must be used: 

(1) child care needs of minor parents; 

(2) child care needs of parents under 21 years of age; and 

(3) child care needs of other parents within the priority group described in this paragraph. 

(b) Second priority must be given to parents who have completed their MFIP or DWP transition year, or parents who are no longer receiving or eligible for diversionary work program supports. 

(c) Third priority must be given to families who are eligible for portable basic sliding fee assistance through the portability pool under subdivision 9. 

(d) Fourth priority must be given to families in which at least one parent is a veteran as defined under section 197.447. 

(e) Families under paragraph (b) must be added to the basic sliding fee waiting list on the date they begin the transition year under section 119B.011, subdivision 20, and must be moved into the basic sliding fee program as soon as possible after they complete their transition year. 

Subd. 5.Review of use of funds; reallocation. 
(a) After each quarter, the commissioner shall review the use of basic sliding fee program allocations by county. The commissioner may reallocate unexpended or unencumbered money among those counties who have expended their full allocation or may allow a county to expend up to ten percent of its allocation in the subsequent allocation period. 

(b) Any unexpended state and federal appropriations from the first year of the biennium may be carried forward to the second year of the biennium. 

Subd. 6.Allocation formula. 
The basic sliding fee state and federal funds shall be allocated on a calendar year basis. Funds shall be allocated first in amounts equal to each county's guaranteed floor according to subdivision 8, with any remaining available funds allocated according to the following formula: 

(a) One-fourth of the funds shall be allocated in proportion to each county's total expenditures for the basic sliding fee child care program reported during the most recent fiscal year completed at the time of the notice of allocation. 

(b) Up to one-fourth of the funds shall be allocated in proportion to the number of families participating in the transition year child care program as reported during and averaged over the most recent six months completed at the time of the notice of allocation. Funds in excess of the amount necessary to serve all families in this category shall be allocated according to paragraph (f). 

(c) Up to one-fourth of the funds shall be allocated in proportion to the average of each county's most recent six months of reported first, second, and third priority waiting list as defined in subdivision 2 and the reinstatement list of those families whose assistance was terminated with the approval of the commissioner under Minnesota Rules, part 3400.0183, subpart 1. Funds in excess of the amount necessary to serve all families in this category shall be allocated according to paragraph (f). 

(d) Up to one-fourth of the funds shall be allocated in proportion to the average of each county's most recent six months of reported waiting list as defined in subdivision 2 and the reinstatement list of those families whose assistance was terminated with the approval of the commissioner under Minnesota Rules, part 3400.0183, subpart 1. Funds in excess of the amount necessary to serve all families in this category shall be allocated according to paragraph (f). 

(e) The amount necessary to serve all families in paragraphs (b), (c), and (d) shall be calculated based on the basic sliding fee average cost of care per family in the county with the highest cost in the most recently completed calendar year. 

(f) Funds in excess of the amount necessary to serve all families in paragraphs (b), (c), and (d) shall be allocated in proportion to each county's total expenditures for the basic sliding fee child care program reported during the most recent fiscal year completed at the time of the notice of allocation. 

Subd. 6a.Allocation due to increased funding. 
When funding increases are implemented within a calendar year, every county must receive an allocation at least equal to its original allocation for the same time period. The remainder of the allocation must be recalculated to reflect the funding increase, according to formulas identified in subdivision 6. 

Subd. 6b.Allocation due to decreased funding. 
When funding decreases are implemented within a calendar year, county allocations must be reduced in an amount proportionate to the reduction in the total allocation for the same time period. This applies when a funding decrease necessitates the revision of an existing calendar year allocation. 

Subd. 8.Guaranteed floor. 
(a) Beginning January 1, 1996, each county's guaranteed floor shall equal 90 percent of the allocation received in the preceding calendar year. For the period January 1, 1999, to December 31, 1999, each county's guaranteed floor must be equal to its original calendar year 1998 allocation or its actual earnings for calendar year 1998, whichever is less. 

(b) When the amount of funds available for allocation is less than the amount available in the previous year, each county's previous year allocation shall be reduced in proportion to the reduction in the statewide funding, for the purpose of establishing the guaranteed floor. 

119B.09 FINANCIAL ELIGIBILITY.Subd. 3.Priorities; allocations. 
If a county projects that its child care allocation is insufficient to meet the needs of all eligible families, it may prioritize among the families that remain to be served after the county has complied with the priority requirements of section 119B.03. Counties that have established a priority for families who are not MFIP participants beyond those established under section 119B.03 must submit the policy in the annual child care fund plan. 

3400.0020DEFINITIONS.   Subp. 8.Allocation.  
"Allocation" means the share of the total state appropriation of child care funds that a county may earn and be reimbursed for in an allocation period. A county's allocation may be raised or lowered during the allocation period when the commissioner redistributes unexpended or unencumbered allocations or when additional funds become available. 

3400.0030NOTICE OF BASIC SLIDING FEE PROGRAM ALLOCATION. 
By July 1 of each year, the commissioner shall notify all county and human services boards of their allocation under the basic sliding fee program, including the amount available for payment of administrative expenses. 

3400.0060BASIC SLIDING FEE PROGRAM.   Subp. 2.Basic sliding fee allocation.  
The commissioner shall allocate child care funds for the basic sliding fee program as provided in Minnesota Statutes, section 119B.03, subdivisions 6 to 9. 

3400.0060BASIC SLIDING FEE PROGRAM.   Subp. 4.Reallocation of unexpended or unencumbered funds.  
The commissioner shall reallocate unexpended or unencumbered funds according to items A to D. 

A.
 The commissioner may reallocate unexpended or unencumbered funds following the first, second, and third quarters of the allocation period as provided in Minnesota Statutes, section 119B.03, subdivision 5. Following the fourth quarter of the allocation period, the commissioner shall review county expenditures under the basic sliding fee program and shall reallocate unearned allocations to counties that had direct service earnings in excess of their allocation. 

B.
 The amount reallocated to any county shall be based on direct service earnings in excess of its allocation. The amount reallocated shall not be greater than the direct service earnings in excess of allocation minus the county's fixed local match to be calculated as specified in Minnesota Statutes, section 119B.11, subdivision 1. 

C.
 If the amount of funds available for reallocation is less than total county direct service earnings in excess of allocations, the reallocated funds shall be prorated to each county based on the ratio of the county's direct service earnings in excess of its allocation to the total of all county direct service earnings in excess of their allocation. 

D.
 If the amount of funds available for reallocation is greater than total county direct service earnings in excess of allocations under the basic sliding fee program, the funds remaining after the basic sliding fee reallocation shall be carried forward and added to the funds available for allocation in the next allocation period. 

3400.0060BASIC SLIDING FEE PROGRAM.   Subp. 6.Basic sliding fee program waiting lists.  
Counties must keep a written record of families who have requested child care assistance. When a family requests information about child care assistance, the county shall perform a preliminary determination of eligibility. If it appears that a family is or will be eligible for child care assistance and funds are not immediately available, the family shall be placed on a child care waiting list. The county must determine the highest priority group for which a family qualifies and must notify the family of this determination. 

Families who inquire or apply while they are temporarily ineligible shall be placed on the waiting list if it appears they will be eligible for child care assistance. When a family advances to the top of the county's waiting list and is temporarily ineligible for child care assistance, the county shall leave the family at the top of the list according to priority group and serve the applicant who is next on the waiting list unless a different procedure is provided in the county's child care fund plan. 

3400.0060BASIC SLIDING FEE PROGRAM.   Subp. 6a.Transfer of families from waiting list to basic sliding fee program.  
Families on the basic sliding fee waiting list shall be moved into the basic sliding fee program as funding permits according to the priorities listed in Minnesota Statutes, section 119B.03. After the county has complied with the priority requirement in section 119B.03, the county must comply with any priority requirements adopted under part 3400.0140, subpart 10, to move families on the waiting list into the basic sliding fee program. 

3400.0060BASIC SLIDING FEE PROGRAM.   Subp. 7.Waiting list; transfer of transition year families to the basic sliding fee program.  A.
 The county shall place transition year families on the county's basic sliding fee program waiting list effective on the date the family became eligible for transition year child care assistance. 

B.
 If a transition year family moves to a new county, the date the family was placed on the basic sliding fee waiting list in the original county shall transfer with the family. 

C.
 Families who are eligible for, but do not use, transition year child care assistance retain their priority status for the basic sliding fee program. Families lose their priority status at the conclusion of their transition year. 

D.
 The county shall manage its basic sliding fee allocation in a way that allows families to move from transition year to the basic sliding fee program without any interruption in services. The county shall not serve families who are a lower priority on the basic sliding fee waiting list than a transition year family unless the county can ensure basic sliding fee program funding for the transition year family at the end of the transition year. 

E. 
When the transition year ends, the county shall move the transition year family into the basic sliding fee program. A transition year family that does not come to the top of the county's basic sliding fee program waiting list before completion of the transition year shall be moved into the basic sliding fee program as funding becomes available according to the priority under Minnesota Statutes, section 119B.03, subdivision 4. Transition year extension child care may be used to support employment or a job search that meets the requirements of Minnesota Statutes, section 119B.10, for the time necessary for the family to be moved from the basic sliding fee waiting list into the basic sliding fee program. 

3400.0140COUNTY RESPONSIBILITIES.   Subp. 10.Eligibility priorities for beginning assistance.  
If a county's basic sliding fee program allocation for child care is insufficient to fund all applications for child care assistance, the county may prioritize eligibility among the groups that remain to be served after the county has complied with the priority requirements set forth in Minnesota Statutes, section 119B.03, subdivision 4. The county shall include its rationale for the prioritization of eligibility for beginning assistance in its biennial child care fund plan. To the extent of available allocations, no eligible family may be excluded from receiving child care assistance. 

3400.0183TERMINATION OF CHILD CARE ASSISTANCE.   Subpart 1.Conditions for termination of child care assistance. A.
A county may terminate child care assistance for families already receiving assistance when the county receives: (1) a revised allocation from the child care fund that is smaller than the allocation stated in the notice sent to the county under part 3400.0030; and (2) such short notice of a change in its allocation that the county could not have absorbed the difference in the allocation. The county must consult with and obtain approval from the commissioner before terminating assistance under this subpart. 

B.
 If the conditions described in this subpart occur, the county may terminate assistance to families in the order of last on, first off. When funds become available, counties must reinstate families that remain eligible for child care assistance and whose child care assistance was terminated due to insufficient funds before the county accepts new applications. Those families whose child care assistance was most recently terminated due to insufficient funds shall be reinstated first.