Senate Bill 701 (SB701), passed by the California legislature in September, 2005, authorized the San Francisco Child Care Individualized County Subsidy Plan (the ‘SF Pilot’), a county child care subsidy plan specifically tailored to the needs and goals of the local community. The key goals of the SF Pilot are ensuring stable enrollment and reducing unearned state subsidy funding across the City and County of San Francisco.

The SF Pilot allows San Francisco County to address two fundamental concerns:

First, that those families barely earning enough to meet the high costs of living in the county are nevertheless considered too high income to qualify for California Department of Education-Early Education and Support Division (CDE-EESD) child care subsidies in programs holding contracts with the state. Participating families are able to remain eligible up to a higher income threshold. The threshold for initial eligibility is unchanged.

Second, that the state reimbursement rates to state-subsidized (Title 5) providers contracted to provide high quality early care and education are so low that providers cannot cover their costs, and therefore, are unable to utilize their full allocation of state and federal child care and child development funds. As a result, fewer children are subsidized through these providers, and early education spaces are lost to the county. The SF Pilot contract terms provides for higher contractor reimbursement rates as follows:

  • Non-Pilot daily reimbursement rate: $36.10
  • San Francisco Pilot daily reimbursement rate: $38.46
  • San Francisco Unified School District Pilot daily reimbursement rate: $41.43

The SF Pilot is a no-cost option to the state that allows San Francisco to innovate and shore up the fiscally weak subsidized early care and education delivery system. The only resources for the SF Pilot are County allocated unearned and recaptured funds from existing contracts and the collection of fees. Unearned funding from contractors can be transferred on a temporary basis to other contractors within San Francisco, who can then utilize it to serve those children most eligible for subsidies from SF Child Care Connection (SF3C), the citywide eligibility list.

The San Francisco Individualized County Subsidy Plan is critical to the effectiveness and efficient use of public funds. San Francisco contractors continue to work together to serve as many eligible low income families as possible, to use state subsidy dollars allocated to San Francisco with care, to coordinate funding, and to support all parts of our local early care and education system by providing quality early education to our most vulnerable children.