Child Care Providers Reach Initial Agreement With State On Covid-19 Relief For Providers And Families

Today, the 40,000 child care providers in California represented by Child Care Providers United (CCPU) announced an agreement with the state, pending legislative approval, that will help keep the doors of family child cares open to essential workers, support the distance learning needs of children, and will help family child care providers support their own families given the increasing costs of COVID-19 precautions. This initial agreement provides some additional funding for subsidized providers, more paid closure days due to COVID-19, and a streamlined process to continue to address providers’ and families’ challenges related to COVID-19. Leaders of the union made the following comments on the agreement:

“This agreement brings relief to child care providers like me who were struggling to survive even before COVID-19 hit us with extra costs and lost revenue,” said Lucrece Lester, a child care provider in Contra Costa County. “I’ve had to close my doors three times in the past year due to potential COVID-19 exposures, losing far more days of pay than compensated by the state. With this new agreement, I can feel confident I’ll be able to re-open rather than join nearly 6,000 of my fellow providers who shut their doors for good last year.”

“As chairperson of CCPU, I’m tremendously proud of the 40,000 child care providers who wrote letters, made phone calls, and held socially distant events for more than a year to stabilize a child care system in crisis and push forward on our goals to strengthen child care to serve California’s families and ready young people for lifelong learning. This agreement shows the strength workers have when they stand together in their union to demand their voices be heard,” said Max Arias, Chairperson of CCPU.

“This agreement includes funding for providers to help address increased child care operational costs from distance learning, PPE, cleaning supplies, and more, along with 16 more paid COVID-19 closure days, which may also be applied retroactively. California’s child care providers have been waiting for this relief for far too long, and we’re glad to see the state stepping up to support us,” said Johanna Puno Hester, Vice Chairperson of CCPU.

CCPU will continue to negotiate its first collective bargaining agreement with the State of California that addresses provider compensation and benefits, training and professional development, and other priorities. This agreement represents an important first step and we hope to continue to work collaboratively with the State of California to build a 21st-century, high-quality child care system in California that meets the needs of every child, parent, and early educator.

WHAT – What benefits does the Retirement Fund expect to offer providers?

Expand the Retirement Fund Benefits Table to see benefits.

 

 Plan Rules
Eligible participants*

You are eligible to participate in the Retirement Plan for a 2024 contribution if you are:

  • A licensed child care provider
  • Who has been paid 6 or more months of child subsidy in the 2023 calendar year (can be non-consecutive months).
Eligibility for benefit credit for contributions in 2024*

You will earn your full service credits for 2023 if you were paid for ten or more months of child subsidy in 2023.

If you were paid for 6 or more months of child subsidy, you will receive 60% of your service credits, 70% for 7 months, 80% for 8 months and 90% for 9 months. You will not earn any service credit if you were paid for less than 6 months.

ContributionsThe only contributions to the Retirement Plan will be paid by the State. The Plan does not accept contributions from you.
Amount of annual employer contributions for 2023 service allocable to participants in 2024*

The amount of the State contribution on your behalf in 2024 will be based on two factors:

(1)  the number of years and months that you held a license as of 12/31/23; AND

(2)  the number of months that you were paid for a subsidized child in 2023.

  • If you were paid for ten or more months, you will receive your full contribution.
  • If you were paid for 6 to 9 months, you will receive a pro-rated contribution.
  • If you were paid for less than 6 months, you will not receive a contribution in 2024.
Amount of annual employer contributions for 2024 service allocable to participants in 2025*You will earn one full service credit for the State contribution on your behalf in 2025 if you were paid for ten or more months of child subsidy in 2024. If you were paid for 6 to 9 months in 2024, you will receive a pro-rated service credit. You will not earn any service credit if you were paid for less than 6 months in 2024.
VestingYou are “vested” in any contribution correctly made to your account. You do not need to work a minimum number of years before 2024 to be entitled to a benefit.
Distribution events

You can elect to receive your account when:

  • You stop all work as a licensed provider for 9 consecutive months at any age (“terminate from service”);
  • You stop all work as a licensed provider for 3 consecutive months at age 60 or older (“retirement”); or
  • You attain age 73, which is the age you are required to start receiving payments, unless you are still working.
Forms of distributions

If you are age 60 or older and stop all work as a licensed provider for 3 consecutive months and elect to retire, you can choose to receive your account balance as:

  • One lump-sum payment
  • Approximately equal monthly payments for 5 years
  • Approximately equal monthly payments for 10 years

If you are younger than age 60 and stop all work as a licensed provider for 9 consecutive months, you can only elect to receive your account as one lump-sum payment.

Death benefitsSince your account is 100% vested, you can designate a beneficiary (or multiple beneficiaries) to receive your account balance if you die before you receive it.
InvestmentsThe Board of Trustees will manage how the Retirement Plan is invested on your behalf, with the assistance of investment professionals.

*Special rules apply to providers where more than one provider is on the payment record.

who

Who is eligible for the Retirement Fund benefits?

State contributions to the Retirement Plan are tied to the child care subsidy program. To be eligible for retirement benefits in 2024, you must be a licensed provider who has have been paid for work with a subsidized child in at least 6 months in 2023-these months do not need to be consecutive. License exempt providers are not eligible; however, if you become licensed in a year, your work in that year may count for eligibility.

when

When will the benefits be available?

State contributions to the Retirement Plan are tied to the child care subsidy program. To be eligible for retirement benefits in 2024, you must be a licensed provider who has have been paid for work with a subsidized child in at least 6 months in 2023-these months do not need to be consecutive. License exempt providers are not eligible; however, if you become licensed in a year, your work in that year may count for eligibility.

how

How can I get help enrolling?

The Plan will automatically enroll you based on the information it has but you should immediately complete the form that the Plan will send you to be sure that the Plan has all of your current information and that you receive credit for your years of licensed work.