As Introduced

136th General Assembly

Regular Session H. B. No. 647

2025-2026

Representatives Plummer, Young

To amend sections 5104.042, 5104.30, 5104.32, and 5104.34 and to enact section 109.44 of the Revised Code and to amend Sections 423.10, as subsequently amended, and 423.105 of H.B. 96 of the 136th General Assembly to revise the law governing the publicly funded child care program, modify an appropriation for the Child Care Cred Program, and to make an appropriation for a data analytics project.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 5104.042, 5104.30, 5104.32, and 5104.34 be amended and section 109.44 of the Revised Code be enacted to read as follows:

Sec. 109.44. (A) Upon the written request of the governor, the general assembly, the auditor of state, the director of children and youth, or the director of budget and management, or upon the attorney general's becoming aware of criminal or improper activity related to Chapter 5104. and the publicly funded child care program described in section 5104.30 of the Revised Code, the attorney general shall investigate any criminal or civil violation of law related to Chapter 5104. of the Revised Code or the publicly funded child care program.

(B) When it appears to the attorney general, as a result of an investigation under division (A) of this section, that there is cause to prosecute for the commission of a crime or to pursue a civil remedy, the attorney general may refer the evidence to the prosecuting attorney having jurisdiction of the matter, to a regular grand jury drawn and impaneled pursuant to sections 2939.01 to 2939.24 of the Revised Code, or to a special grand jury drawn and impaneled pursuant to section 2939.17 of the Revised Code, or the attorney general may initiate and prosecute any necessary criminal or civil actions in any court or tribunal of competent jurisdiction in this state. When proceeding under this section, the attorney general, and any assistant or special counsel designated by the attorney general for that purpose, has all rights, privileges, and powers of prosecuting attorneys. The attorney general has exclusive supervision and control of all investigations and prosecutions initiated by the attorney general under this section. The forfeiture provisions of Chapter 2981. of the Revised Code apply in relation to any such criminal action initiated and prosecuted by the attorney general.

(C) Nothing in this section prevents a county prosecuting attorney from investigating and prosecuting criminal activity related to Chapter 5104. of the Revised Code and the publicly funded child care program. The forfeiture provisions of Chapter 2981. of the Revised Code apply in relation to any prosecution of criminal activity related to the publicly funded child care program undertaken by the prosecuting attorney.

Sec. 5104.042. (A) The department of children and youth may suspend, without a prior hearing, the license of a child care center, type A family child care home, or licensed type B family child care home if any of the following occur:

(1) A child dies or suffers a serious injury while receiving child care in the center, type A home, or licensed type B home.

(2) A public children services agency receives a report pursuant to section 2151.421 of the Revised Code, and the person alleged to have inflicted abuse or neglect on the child who is the subject of the report is any of the following:

(a) The owner, licensee, or administrator of the center, type A home, or licensed type B home;

(b) An employee of the center, type A home, or licensed type B home who has not immediately been placed on administrative leave or released from employment;

(c) Any person who resides in the type A home or licensed type B home.

(3) An owner, licensee, administrator, or employee of the center, type A home, or licensed type B home, or a resident of the type A home or licensed type B home is charged by an indictment, information, or complaint with an offense relating to the abuse or neglect of a child.

(4) The department or a county department of job and family services determines that the center, type A home, or licensed type B home created a serious risk to the health or safety of a child receiving child care in the center, type A home, or licensed type B home that resulted in or could have resulted in a child's death or injury.

(5) The department determines that the owner or licensee of the center, type A home, or licensed type B home does not meet the requirements of section 5104.013 of the Revised Code.

(6) The department has reason to suspect that an owner, licensee, administrator, or employee of the center, type A home, or licensed type B home or a resident of the type A home or licensed type B home engaged in the misuse of public dollars or acted with intent to commit fraud against the publicly funded child care program.

(B) The department shall serve a written order of suspension on the licensee as described in sections 119.05 and 119.07 of the Revised Code. The licensee may request an adjudicatory hearing before the department pursuant to sections 119.06 to 119.12 of the Revised Code.

(C) Any summary suspension imposed under this section shall remain in effect until any of the following occurs:

(1) The public children services agency completes its investigation of the report pursuant to section 2151.421 of the Revised Code and determines that all of the allegations are unsubstantiated.

(2) All criminal charges are disposed of through dismissal or a finding of not guilty.

(3) The department issues pursuant to Chapter 119. of the Revised Code a final order terminating the suspension.

(D) The center, type A home, or licensed type B home shall not provide child care while the summary suspension remains in effect. Upon issuance of the order of suspension, the licensee shall inform the caretaker parent of each child receiving child care in the center, type A home, or licensed type B home of the suspension.

(E) The director of children and youth may adopt rules in accordance with Chapter 119. of the Revised Code establishing standards and procedures for the summary suspension of licenses.

(F) This section does not limit the authority of the department to revoke a license pursuant to section 5104.04 of the Revised Code.

Sec. 5104.30. (A) The department of children and youth is hereby designated as the state agency responsible for administration and coordination of federal and state funding for publicly funded child care in this state. Publicly funded child care shall be provided to the following:

(1) Recipients of transitional child care as provided under section 5104.34 of the Revised Code;

(2) Participants in the Ohio works first program established under Chapter 5107. of the Revised Code;

(3) Individuals who would be participating in the Ohio works first program if not for a sanction under section 5107.16 of the Revised Code and who continue to participate in a work activity, developmental activity, or alternative work activity pursuant to an assignment under section 5107.42 of the Revised Code;

(4) A family receiving publicly funded child care on October 1, 1997, until the family's income reaches one hundred fifty per cent of the federal poverty line;

(5) Subject to available funds, other individuals determined eligible in accordance with rules adopted under section 5104.38 of the Revised Code.

The department shall apply to the United States department of health and human services for authority to operate a coordinated program for publicly funded child care, if the director of children and youth determines that the application is necessary. For purposes of this section, the department of children and youth may enter into agreements with other state agencies that are involved in regulation or funding of child care. The department shall consider the special needs of migrant workers when it administers and coordinates publicly funded child care and shall develop appropriate procedures for accommodating the needs of migrant workers for publicly funded child care.

(B) The department of children and youth shall distribute state and federal funds for publicly funded child care, including appropriations of state funds for publicly funded child care and appropriations of federal funds available under the child care block grant act, Title IV-A, and Title XX. The department may use any state funds appropriated for publicly funded child care as the state share required to match any federal funds appropriated for publicly funded child care.

(C) In the use of federal funds available under the child care block grant act, all of the following apply:

(1) The department may use the federal funds to hire staff to prepare any rules required under this chapter and to administer and coordinate federal and state funding for publicly funded child care.

(2) Not more than five per cent of the aggregate amount of the federal funds received for a fiscal year may be expended for administrative costs.

(3) The department shall allocate and use at least four per cent of the federal funds for the following:

(a) Activities designed to provide comprehensive consumer education to parents and the public;

(b) Activities that increase parental choice;

(c) Activities, including child care resource and referral services, designed to improve the quality, and increase the supply, of child care;

(d) Establishing the step up to quality program pursuant to section 5104.29 of the Revised Code.

(4) The department shall ensure that the federal funds will be used only to supplement, and will not be used to supplant, federal, state, and local funds available on the effective date of the child care block grant act for publicly funded child care and related programs. If authorized by rules adopted by the department pursuant to section 5104.42 of the Revised Code, county departments of job and family services may purchase child care from funds obtained through any other means.

(D) The department shall encourage the development of suitable child care throughout the state, especially in areas with high concentrations of recipients of public assistance and families with low incomes. The department shall encourage the development of suitable child care designed to accommodate the special needs of migrant workers. On request, the department, through its employees or contracts with state or community child care resource and referral service organizations, shall provide consultation to groups and individuals interested in developing child care. The department of children and youth may enter into interagency agreements with the department of education and workforce, the chancellor of higher education, the department of development, and other state agencies and entities whenever the cooperative efforts of the other state agencies and entities are necessary for the department of children and youth to fulfill its duties and responsibilities under this chapter.

The department shall develop and maintain a registry of persons providing child care. The director shall adopt rules in accordance with Chapter 119. of the Revised Code establishing procedures and requirements for the registry's administration.

(E)(1) The director shall adopt rules in accordance with Chapter 119. of the Revised Code establishing both of the following:

(a) Payment rates for providers of publicly funded child care not later than the first day of July in each odd-numbered year;

(b) A procedure for paying providers of publicly funded child care.

(2) In establishing payment rates under division (E)(1)(a) of this section, the director shall do all of the following:

(a) Use the information obtained from the market rate survey developed and conducted in accordance with 45 C.F.R. 98.45;

(b) Establish an enhanced payment rate for providers who enroll children whose provide child care for caretaker parents who work nontraditional hours;

(c) With regard to the step up to quality program established pursuant to section 5104.29 of the Revised Code, establish enhanced payment rates for child care providers that participate in the program.

(3) In establishing payment rates under division (E)(1)(a) of this section, the director may establish different payment rates based on any of the following:

(a) Geographic location of the provider;

(b) Type of care provided;

(c) Age of the child served;

(d) Special needs of the child served;

(e) Whether the expanded hours of service are provided;

(f) Whether weekend service is provided;

(g) Whether the provider has exceeded the minimum requirements of state statutes and rules governing child care;

(h) Any other factors the director considers appropriate.

Sec. 5104.32. (A) All purchases of publicly funded child care shall be made under a contract entered into by a licensed child care center, licensed type A family child care home, licensed type B family child care home, certified in-home aide, approved child day camp, licensed preschool program, licensed school child program, or border state child care provider and the department of children and youth. All contracts for publicly funded child care shall be contingent upon the availability of state and federal funds. The department shall prescribe a standard form to be used for all contracts for the purchase of publicly funded child care, regardless of the source of public funds used to purchase the child care. To the extent permitted by federal law and notwithstanding any other provision of the Revised Code that regulates state contracts or contracts involving the expenditure of state or federal funds, all contracts for publicly funded child care shall be entered into in accordance with the provisions of this chapter and are exempt from any other provision of the Revised Code that regulates state contracts or contracts involving the expenditure of state or federal funds.

(B) Each contract for publicly funded child care shall specify at least the following:

(1) That the provider of publicly funded child care agrees to be paid at the rate established pursuant to section 5104.30 of the Revised Code;

(2) Whether the county department of job and family services, the provider, or a child care resource and referral service organization will make eligibility determinations, whether the provider or a child care resource and referral service organization will be required to collect information to be used by the county department to make eligibility determinations, and the time period within which the provider or child care resource and referral service organization is required to complete required eligibility determinations or to transmit to the county department any information collected for the purpose of making eligibility determinations;

(3) That the provider, other than a border state child care provider, shall continue to be licensed, approved, or certified pursuant to this chapter and shall comply with all standards and other requirements in this chapter and in rules adopted pursuant to this chapter for maintaining the provider's license, approval, or certification;

(4) That, in the case of a border state child care provider, the provider shall continue to be licensed, certified, or otherwise approved by the state in which the provider is located and shall comply with all standards and other requirements established by that state for maintaining the provider's license, certificate, or other approval;

(5) Whether the provider will be paid by the department of children and youth or in some other manner as prescribed by rules adopted under section 5104.42 of the Revised Code;

(6) That the contract is subject to the availability of state and federal funds.

(C)(1) The department shall establish an automated child care system to track child attendance and enrollment and calculate payments for publicly funded child care. Not later than July 9, 2028, and thereafter, the The department shall calculate payments for publicly funded child care based on a child's enrollment, as described in 45 C.F.R. 98.45(m), rather than on a child's attendance.

(2) Each eligible provider that provides publicly funded child care shall participate in the automated child care system. A provider participating in the system shall not do any of the following:

(a) Use or have possession of a personal identification number or password issued to a caretaker parent under the automated child care system;

(b) Falsify child attendance or enrollment records;

(c) Knowingly seek or accept payment for publicly funded child care for a child not enrolled in attendance with the provider or for which the provider was not eligible;

(d) Knowingly seek or accept payment for child care for a child who resides in the provider's own home.

(D) The department may withhold any money due under this chapter and may , recover through any appropriate method any money erroneously paid under this chapter, or suspend or terminate a contract to provide publicly funded child care entered into under this section if evidence demonstrates that a provider of publicly funded child care failed to comply with either or the department has reason to suspect any of the following:

(1) The That a provider of publicly funded child care failed to comply with the terms of the contract entered into under this section;

(2) This That a provider of publicly funded child care failed to comply with this chapter or any rules adopted under it;

(3) That a provider of publicly funded child care engaged in the misuse of public funds or acted with intent to commit fraud against the publicly funded child care program.

(E) If the department has evidence that a provider has employed an individual who is ineligible for employment under section 5104.013 of the Revised Code and the provider has not released the individual from employment upon notice that the individual is ineligible, the department may terminate immediately the contract entered into under this section to provide publicly funded child care entered into under this section.

(F) Any decision by the department concerning publicly funded child care, including the recovery of funds, overpayment determinations, and contract suspensions or terminations is final and is not subject to appeal, hearing, or further review under Chapter 119. of the Revised Code.

Sec. 5104.34. (A)(1) Each county department of job and family services shall implement procedures for making determinations of eligibility for publicly funded child care. Under those procedures, the eligibility determination for each applicant shall be made no later than thirty calendar days from the date the county department receives a completed application for publicly funded child care. Each applicant shall be notified promptly of the results of the eligibility determination. An applicant aggrieved by a decision or delay in making an eligibility determination may appeal the decision or delay to the department of children and youth in accordance with section 5101.35 of the Revised Code. The due process rights of applicants shall be protected.

To the extent permitted by federal law, the county department may make all determinations of eligibility for publicly funded child care, may contract with child care providers or child care resource and referral service organizations for the providers or resource and referral service organizations to make all or any part of the determinations, and may contract with child care providers or child care resource and referral service organizations for the providers or resource and referral service organizations to collect specified information for use by the county department in making determinations. If a county department contracts with a child care provider or a child care resource and referral service organization for eligibility determinations or for the collection of information, the contract shall require the provider or resource and referral service organization to make each eligibility determination no later than thirty calendar days from the date the provider or resource and referral organization receives a completed application that is the basis of the determination and to collect and transmit all necessary information to the county department within a period of time that enables the county department to make each eligibility determination no later than thirty days after the filing of the application that is the basis of the determination.

The county department may station employees of the department in various locations throughout the county to collect information relevant to applications for publicly funded child care and to make eligibility determinations. The county department, child care provider, and child care resource and referral service organization shall make each determination of eligibility for publicly funded child care no later than thirty days after the filing of the application that is the basis of the determination, shall make each determination in accordance with any relevant rules adopted pursuant to section 5104.38 of the Revised Code, and shall notify promptly each applicant for publicly funded child care of the results of the determination of the applicant's eligibility.

The director of children and youth shall adopt rules in accordance with Chapter 119. of the Revised Code for monitoring the eligibility determination process. In accordance with those rules, the state department shall monitor eligibility determinations made by county departments of job and family services and shall direct any entity that is not in compliance with this division or any rule adopted under this division to implement corrective action specified by the department.

(2)(a) All eligibility determinations for publicly funded child care shall be made in accordance with rules adopted pursuant to division (A) of section 5104.38 of the Revised Code. Except as otherwise provided in this section, all of the following apply:

(i) Publicly funded child care may be provided only to eligible infants, toddlers, preschool-age children, school-age children under age thirteen, or children receiving special needs child care.

(ii) For an applicant to be eligible for publicly funded child care, the caretaker parent must be employed or participating in a program of education or training for an amount of time reasonably related to the time that the parent's children are receiving publicly funded child care. This restriction does not apply to families whose children are eligible for protective child care.

(iii) The eligibility period for publicly funded child care shall be at least twelve months.

(b) If a caretaker parent who has been determined eligible to receive publicly funded child care no longer meets the requirements of division (A)(2)(a)(ii) of this section, the caretaker parent may continue to receive publicly funded child care for a period of at least three but not more than four months not to extend beyond the caretaker parent's eligibility period.

(c) If a child turns thirteen, or if a child receiving special needs child care turns eighteen, during the eligibility period, the caretaker parent may continue to receive publicly funded child care until the end of that eligibility period.

Subject to available funds, the department of children and youth shall allow a family to receive publicly funded child care unless the family's income exceeds the maximum income eligibility limit. Initial and continued eligibility for publicly funded child care is subject to available funds unless the family is receiving child care pursuant to division (A)(1), (2), (3), or (4) of section 5104.30 of the Revised Code. If the department must limit eligibility due to lack of available funds, it shall give first priority for publicly funded child care to an assistance group whose income is not more than the maximum income eligibility limit that received transitional child care in the previous month but is no longer eligible because the eligibility period has expired. Such an assistance group shall continue to receive priority for publicly funded child care until its income exceeds the maximum income eligibility limit.

(3) An assistance group that ceases to participate in the Ohio works first program established under Chapter 5107. of the Revised Code is eligible for transitional child care at any time during the immediately following twelve-month period that both of the following apply:

(a) The assistance group requires child care due to employment;

(b) The assistance group's income is not more than one hundred fifty per cent of the federal poverty line.

An assistance group ineligible to participate in the Ohio works first program pursuant to section 5101.83 or section 5107.16 of the Revised Code is not eligible for transitional child care.

(B) To the extent permitted by federal law, the department of children and youth may require a caretaker parent determined to be eligible for publicly funded child care to pay a fee according to the schedule of fees established in rules adopted under section 5104.38 of the Revised Code. The department shall make protective child care services and homeless child care services available to children without regard to the income or assets of the caretaker parent of the child.

(C) A caretaker parent receiving publicly funded child care shall report to the entity that determined eligibility any changes in status with respect to employment or participation in a program of education or training not later than ten calendar days after the change occurs.

(D) If the department of children and youth determines that available resources are not sufficient to provide publicly funded child care to all eligible families who request it, the department may establish a waiting list. The department may establish separate waiting lists within the waiting list based on income.

(E) A caretaker parent shall not receive publicly funded child care only from more than one child care provider per child during a week, unless a county department grants the family an exemption on a temporary basis for one either of the following reasons:

(1) The child needs additional care during non-traditional hours;

(2) The child needs to change providers in the middle of the week, for a period not more than one week, and the hours of care provided by the providers do not overlap;

(3)(2) The child's provider is closed on scheduled school days off or on calamity days.

(F) As used in this section, "maximum income eligibility limit" means the amount of income specified in rules adopted under division (A) of section 5104.38 of the Revised Code.

Section 2. That existing sections 5104.042, 5104.30, 5104.32, and 5104.34 of the Revised Code are hereby repealed.

Section 3. That Sections 423.10 (as amended by H.B. 434 of the 136th General Assembly) and 423.105 of H.B. 96 of the 136th General Assembly be amended to read as follows:

Sec. 423.10.

Sec. 423.105. COMMUNITY PROJECTS AND ASSISTANCE

Of the foregoing appropriation item 830420, Community Projects and Assistance, $2,000,000 in fiscal year 2026 and $3,000,000 in fiscal year 2027 shall be used to support enhanced data analytics in order to conduct automated attendance reviews of publicly funded child care providers.

Of the foregoing appropriation item 830420, Community Projects and Assistance, $500,000 in fiscal year 2026 shall be distributed to Birthing Beautiful Communities to provide perinatal support services for at-risk mothers and children in Cuyahoga and Summit counties.

Of the foregoing appropriation item 830420, Community Projects and Assistance, $100,000 in each fiscal year shall be provided to Applewood Centers, Inc., to expand its foster care program.

Section 4. That existing Sections 423.10 (as amended by H.B. 434 of the 136th General Assembly) and 423.105 of H.B. 96 of the 136th General Assembly are hereby repealed.