Senate Bill 1378 establishes a new division within the Tennessee Department of Education, known as the Division of Early Child Care and Education, which must be created by December 31, 2026. The bill outlines the division's administrative responsibilities, which include overseeing all child care and early educational services funded through state or federal resources, such as the Child Care and Development Block Grant and the Individuals with Disabilities Education Act. Additionally, the division is tasked with creating a unified early child care and education system that prioritizes child health and safety while reducing regulatory burdens for providers. This includes implementing a uniform licensing system, accountability measures, and community engagement mechanisms.

To facilitate the establishment of this division and system, the bill mandates the creation of a two-part transition plan, which must be developed with the assistance of a transition advisory council. This council will consist of various stakeholders, including government officials and experts in early childhood education. The first phase of the transition plan is due by January 1, 2026, and must detail the establishment of the division, while the second phase, due by October 1, 2026, will focus on the unified system. The division is also required to publish a strategic plan by January 1, 2027, and provide annual reports to the General Assembly on its progress.