SB 890
Department of Legislative Services
Maryland General Assembly
2021 Session
FISCAL AND POLICY NOTE
First Reader
Senate Bill 890 (Senator King)
Education, Health, and Environmental Affairs
and Budget and Taxation
Early Childhood Education – Child Care Provider Support Grant Program (The
Child Care Provider Support Act)
This bill establishes the Child Care Provider Support Grant Program to provide funds to
eligible grantees to help support the operation of child care centers. The Department of
Commerce (Commerce), in consultation with the Maryland State Department of Education
(MSDE), must implement and administer the grant program. Beginning in fiscal 2023, the
Governor must include $25.0 million annually in the State budget for the program. The
bill takes effect July 1, 2021.
Fiscal Summary
State Effect: General fund expenditures increase by $158,000 in FY 2022; future years
reflect annualization of ongoing administrative costs and the bill’s mandated appropriation.
Revenues are not affected. This bill establishes a mandated appropriation beginning in
FY 2023.
($ in millions) FY 2022 FY 2023 FY 2024 FY 2025 FY 2026
Revenues $0 $0 $0 $0 $0
GF Expenditure 0.2 25.2 25.2 25.2 25.2
Net Effect ($0.2) ($25.2) ($25.2) ($25.2) ($25.2)
Note:() = decrease; GF = general funds; FF = federal funds; SF = special funds; - = indeterminate increase; (-) = indeterminate decrease
Local Effect: None.
Small Business Effect: Potential meaningful for eligible child care centers that are
awarded grants.
Analysis
Bill Summary: An eligible grantee is a child care center that:
was in operation before March 2020;
is open and operational on or after September 30, 2020;
has a certificate of good standing in the State;
is enrolled in the Maryland EXCELS program;
accepts State scholarship vouchers;
can demonstrate financial stress or a disruption in operation, including the loss of
at least 20% of enrollment for a period of at least two months from March 1, 2020,
through June 30, 2021;
is not currently serving enrolled children but can confirm its intention to enroll
children no more than 30 days after the date on which a grant is received; and
provides a detailed description of how it anticipates spending the grant and how
many children it anticipates enrolling after the grant is received.
Commerce, in consultation with MSDE and child care industry leaders or advisory groups,
must adopt regulations to implement the bill, including regulations to develop requirements
for grant applications and a process for reviewing and awarding grants.
The Secretary of Commerce may adjust the amount of each grant depending on the number
of eligible grantees and may not award a grant to an eligible grantee in an amount that is
more than the eligible grantee’s total operating expenses over a period of two months. The
Secretary must prioritize grant awards to eligible grantees located in high poverty zip codes
in the State or zip codes with a significant number of licensed child care centers that have
closed permanently.
Grant awards may be used by eligible grantees only for payroll expenses, rent or mortgage
payments, utility expenses, and other similar expenses necessary for the operation of the
child care center.
Current Law: “Child care center” means an agency, institution, or establishment that, for
part or all of a day, or on a 24-hour basis on a regular schedule, and at least twice a week,
offers or provides child care to children who do not have the same parentage except as
otherwise provided for in law or regulation. The State Board of Education must adopt
regulations relating to the licensing and operation of child care centers.
The Child Care Scholarship Program (referred to as the Child Care Subsidy Program in
statute) provides financial assistance with child care costs to eligible low-income families
pursuant to requirements established in regulation.
SB 890/ Page 2
State Expenditures: General fund expenditures increase by $25.0 million annually
beginning in fiscal 2023 to reflect the mandated appropriation. For purposes of this
analysis, it is assumed that expenditures are incurred in fiscal 2022 for administrative costs
associated with the development of the grant program.
Accordingly, general fund expenditures for Commerce increase by $158,490 in fiscal 2022,
which accounts for a three-month start-up delay from the bill’s July 1, 2021 effective date.
This estimate reflects the cost of hiring two staff (one administrator/one accounting
specialist) to assist with the establishment of procedures for and the administration of the
grant program, including consultation with specified entities to adopt related regulations.
It includes salaries, fringe benefits, one-time start-up costs, and ongoing operating
expenses.
Positions 2
Salaries and Fringe Benefits $147,327
Operating Expenses 11,163
Total FY 2022 State Expenditures $158,490
Future year expenditures reflect full salaries with annual increases and employee turnover,
ongoing operating expenses, and the annual $25.0 million mandated appropriation
beginning in fiscal 2023.
MSDE can use existing resources to consult with Commerce.
Small Business Effect: Child care centers meeting specified criteria are eligible for
significant grant funding beginning in fiscal 2023.
Additional Information
Prior Introductions: None.
Designated Cross File: HB 608 (Delegate Solomon) - Ways and Means and
Appropriations.
Information Source(s): Department of Commerce; Maryland State Department of
Education; Department of Legislative Services
Fiscal Note History: First Reader - February 22, 2021
an/rhh
SB 890/ Page 3
Analysis by: Jennifer K. Botts Direct Inquiries to:
(410) 946-5510
(301) 970-5510
SB 890/ Page 4
Statutes affected: Text - First - Early Childhood Education – Child Care Provider Support Grant Program (The Child Care Provider Support Act): 2-020 Education