July 2023

Child Care and Preschool

2023-24 Changes in Child Care Spending

In Millions

  General Fund      
 Change Prop. 98 Non-Prop. 98 Prop. 64 Federal Total
One-time set aside funding for child care MOU and parity agreementa — $1,360 — — $1,360
Adjustment associated with one-time 2022-23 savingsb — 1,048 — — 1,048
Total cost of General Child Care slots initiated April 1, 2022b — 657 — $86 744
CalWORKs caseload and cost of care adjustments — 87 — 53 140
CCPU Health Benefit Trust depositc — 100 — — 100
Annualization of Alternative Payment slots initiated October 1, 2022 — 6 — 82 88
CCPU Retirement Benefit Trust depositd — 80 — — 80
Annualization of General Child Care slots initiated April 1, 2023 — 90 — -28 62
Family fee reductions beginning October 1, 2023 — 56 — — 56
Total cost of Alternative Payment ratese — 18 — 8 26
Child and Adult Care Food program changes $1 —f — 22 23
Technical adjustments — 9 — -7 1
Cost shifts — 134 — -134 0
Lower Proposition 64 funding levels in General Child Careg — — -$46 — -46
Prior year one-time fundingh — -437 — -832 -1,270
Totals $1 $3,207 -$46 -$750 $2,413
a Reflects transfer of one-time savings across multiple fiscal years to support MOU and parity agreement costs. 
b Reflects expiration of one-time 2022-23 savings.
c Reflects maximum amount of potential annual deposits beginning April 1, 2024.
d Reflects initial $80.1 million deposit.
e Reflects full allocation of funds needed to support rate increase effective January 1, 2022.
f Less than $500,000.
g Reduction in Proposition 64 funding levels is due to Proposition 64 revenues coming in lower than expected in 2023-24. The administration intends to backfill this reduction with Proposition 64 carryover funds from prior years.
h Includes prior year one-time costs associated with supplemental rates, child care infrastructure, health and retirement insurance, alternative payment program capacity grant, licensing incentive, family fee waiver, paid nonoperational days, and child care relief funding and stipends.
MOU = Memorandum of Understanding. CCPU = Child Care Providers United.