§ 20 — Operational grant program for early education and care providers; eligible uses for operational grants; formula for distributing operational grants; conditions for receiving grant; compliance standards; reporting

[ Text of section added by 2024, 140, Sec. 36 effective July 1, 2025. See 2024, 140, Sec. 254.]Section 20. (a) The department shall, subject to appropriation, establish, distribute and maintain an operational grant program for early education and care providers to provide high-quality and sustainable education and care.(b) Eligible uses for operational grants shall include, but not be limited to: (i) compensating early education and care provider staff through increased salaries, benefits, bonuses, professional development or access to continuing education opportunities; (ii) increasing the affordability of early education and care to families, including by reducing the tuition and fees paid by families or offering scholarships to families; (iii) enabling early education and care providers to provide high-quality early education and care and to comply with applicable health, safety, educational and quality-assurance requirements, any other requirements of this chapter, and requirements imposed by the department consistent with this chapter; (iv) improving facilities and physical spaces used by the providers; (v) enabling early education and care providers to purchase high-quality, evidence-based early literacy materials; (vi) enabling providers to address emergency situations during which the cost of care significantly increases due to additional federal, state or department requirements or the loss of fees due to absence or unenrollment that jeopardizes early education and care providers' ability to retain their facilities and staff; (vii) enabling early education and care providers to expand hours of operation to meet the needs of children and families; and (viii) enabling early education and care providers to maintain or increase capacity to provide voluntary supplemental services to enrolled children and their families including, but not limited to, social work services, health and disability-related services and support services to parents and caregivers.(c) The department shall maintain a formula for distributing operational grants to early education and care providers, which shall give preference to providers that serve: (i) high numbers of children receiving child care financial assistance or services from head start and early head start programs; (ii) high numbers of high needs children; and (iii) unique populations or that otherwise advance the interests of the program as determined by the department. The formula shall consider: (i) licensed capacity and enrollment including the ages of the children enrolled and the ages of the children for whom the provider has capacity; provided, however, that enrollment shall be measured by the department using quarterly enrollment averages or if deemed appropriate by the department, enrollment averages less frequent than quarterly; (ii) costs associated with employee compensation, including salaries and benefits; (iii) the number of enrolled children receiving child care financial assistance, services from head start and early head start programs or scholarship assistance or other meaningful financial assistance from an early education and care provider; (iv) to the extent feasible, the demographics and income of families served, including the number of children enrolled and identified as high needs; (v) the cost of goods and services necessary for provider operations, including rent, utilities, maintenance and facility improvements; (vi) the cost of quality care methodology developed by the department and, until such time as the methodology is established, any available information regarding the cost of quality early education and care, including available credentialing frameworks and applicable salary guidelines; (vii) increasing the financial stability of providers in need; (viii) the business structure of providers; and (ix) any other factors impacting the cost of providing quality early education and care including, but not limited to, serving infants and toddlers, providing nonstandard hours of care and providing care in socially and economically disadvantaged and historically underrepresented communities with shortages of early education and care slots. A provider that is not an "eligible organization'' as defined in section 18 and that, directly or through an affiliate, operates more than 10 center-based programs in the commonwealth shall not receive more than 1 per cent of annual program funds unless the provider is granted a waiver by the commissioner deeming such allocation of more than 1 per cent to be in the best interest of the commonwealth. The department shall incorporate geographic equity into the development of the distribution formula.Annually, the department shall review and update the operational grant formula to ensure equity and effectiveness in the financial sustainability of early education and care providers. Prior to the establishment or a revision of the operation grant formula, the department shall conduct a public hearing under chapter 30A and submit the proposed updates to the board for its approval.[ Subsection (c1/2) effective until June 30, 2029. Repealed by 2024, 140, Sec. 261. See 2024, 140, Sec. 262.](c1/2) To prioritize low-income and at-risk children, the department shall annually ensure not less than 50.5 per cent of operational grant funding distributed in a fiscal year is disbursed to: (i) providers with enrollment of at least 25 per cent of children receiving child care financial assistance or otherwise serving at least 25 per cent of low and at-risk children; or (ii) head start or early head start programs.(d) As a condition for receiving operational grants under this section, the department shall require early education and care providers to: (i) enter into and comply with contractual agreements with the department or its agents, which shall be developed by the department; (ii) continue to, or demonstrate a willingness to, enroll children receiving child care financial assistance, if a family receiving child care financial assistance chooses the provider and the provider has an available opening; (iii) demonstrate progress towards increasing salary, compensation and benefits in alignment with the career ladder established in section 21, and if not feasible, provide increased salaries, compensation and benefits to the extent possible; and (iv) provide the department with data that the department requires, as needed to carry out the department's assessment and reporting requirements under this section. The department shall solicit public comments prior to establishing or revising criteria for eligible recipients of the operational grant program.(e) Operational grants shall, subject to appropriation and the distribution formula developed under subsection (c), be renewed for each provider; provided, however, that renewal shall not be required if there is a change in circumstances for the provider making them ineligible, the provider is not in compliance with this section or if the department, in its discretion, determines that renewal would not be appropriate.(f) The department shall establish enforceable compliance standards to ensure the integrity of the program. The standards shall ensure that open slots in early education and care providers that receive operational grants are accessible to children receiving child care financial assistance and that recipients are making meaningful progress towards complying with the career ladder standards established in section 21; provided, however, that a provider that is not an "eligible organization'' as defined in section 18 o f and that, directly or through an affiliate, operates more than 10 center-based programs in the commonwealth and receives operational grants shall: (i) demonstrate a willingness to accept more children receiving child care financial assistance at each program location operated by the provider or an affiliate of the provider in proportion to the provider's size, as determined by the department; (ii) dedicate a certain percentage of the provider's operational grant funds, as determined by the department, to increasing compensation for their early education educators and make meaningful progress towards complying with the department's career ladder; and (iii) annually provide the department with an audited financial statement detailing how the provider's operational grant funds are spent. Prior to establishing or revising standards, the department shall solicit public input.(g) The department shall include information on the status of the operational grant program in the department's annual report required by subsection (g) of section 3. This information shall include, but not be limited to: (i) a description of the distribution formula; (ii) an analysis of the incorporation of equity into the distribution formula; (iii) an analysis of the demographic data of the families served by recipients of operational grants; (iv) an analysis of how recipients are using operational grants; (v) an analysis of the impact of the operational grant program on supporting provider sustainability, increasing the availability of early education and care slots, supporting the early education and care workforce, assisting providers with complying with the career ladder established under section 21 and improving access to, and the affordability of, high-quality early education and care; (vi) an analysis of the impact that the termination of the operational grant program would have on the commonwealth; (vii) if applicable, recommendations on how the program could be modified to most effectively direct grant funding to providers serving families with the greatest needs; and (viii) if applicable, recommendations on how to amend the distribution formula to maximize the goals of educational equity, school readiness and optimal results for families with the greatest needs. The department shall publicly post on its website the amount of operational grants awarded, delineated by the name of each recipient and by the municipality in which the recipient is located.