The bill amends the Early Childhood Care Accountability Act to establish limitations on the use of funds received by licensed child care and early childhood care programs when contracting with the Early Childhood Education and Care Department. It prohibits these programs from using funds for certain expenses, such as monitoring, franchise, or management fees paid to their parent companies, as well as executive compensation or bonuses to investment firms. Additionally, the bill restricts the use of funds for operations outside of New Mexico and prohibits programs from paying dividends to investors or selling real property to enter into lease agreements with other business entities.

Furthermore, the bill mandates that by December 1, 2026, and annually thereafter, the Early Childhood Education and Care Department must report to the legislative health and human services committee on various aspects of the contracted programs. This includes details about the business structure of controlling entities, executive compensation, debt-to-earnings ratios, any acquisitions or closures of child care programs, and financial transactions related to real estate leases and purchases. The intent of these provisions is to ensure accountability and transparency in the management of funds allocated to child care programs in New Mexico.

Statutes affected:
introduced version: 32A-23C-1