Increase Flexibility for Tribes in Child Care and Development Fund (CCDF) Eligibility

<RULE> DEPARTMENT OF HEALTH AND HUMAN SERVICES <CFR>45 CFR Part 98</CFR> <RIN>RIN 0970-AD11</RIN> <SUBJECT>Increase Flexibility for Tribes in Child Care and Development Fund (CCDF) Eligibility</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Office of Child Care (OCC), Administration for Children and Families (ACF), Department of Health and Human Services (HHS). <HD SOURCE="HED">ACTION:</HD> Final rule. <SUM> <HD SOURCE="HED">SUMMARY:</HD> This final rule amends the Child Care and Development Fund (CCDF) regulations to provide all Indian Tribes and Tribal Organizations operating CCDF programs the flexibility, at their discretion, to establish and use eligibility criteria regardless of family income or assets. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> <E T="03">Effective:</E> November 18, 2024. </EFFDATE> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Megan Campbell, Office of Child Care, 202-690-6499 or <E T="03">megan.campbell@acf.hhs.gov.</E> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <GPOTABLE COLS="2" OPTS="L0,tp0,p1,8/9,g1,t1,i1" CDEF="s200,6"> <TTITLE> </TTITLE> <CHED H="1"> </CHED> <CHED H="1"> </CHED> <ROW> <ENT I="01">I. Statutory Authority </ENT> <ENT>3</ENT> </ROW> <ROW> <ENT I="01">II. Background </ENT> <ENT>3</ENT> </ROW> <ROW> <ENT I="03">Effective Dates</ENT> <ENT I="01">III. Development of Regulation </ENT> <ENT>5</ENT> </ROW> <ROW> <ENT I="01">IV. Discussion of Comments and Regulatory Provisions </ENT> <ENT>7</ENT> </ROW> <ROW> <ENT I="01">V. Regulatory Process Matters </ENT> <ENT>9</ENT> </ROW> <ROW> <ENT I="03">Regulatory Flexibility Act</ENT> <ENT>11</ENT> </ROW> <ROW> <ENT I="03">Unfunded Mandates Reform Act of 1995</ENT> <ENT>12</ENT> </ROW> <ROW> <ENT I="03">Executive Order 13132</ENT> <ENT I="03">Assessment of Federal Regulations and Policies on Families</ENT> <ENT>13</ENT> </ROW> <ROW> <ENT I="03">Regulatory Review</ENT> <ENT I="01">VI. Tribal Consultation Statement </ENT> <ENT>14</ENT> </ROW> <ROW> <ENT I="01">List of Subjects in 45 CFR Part 98 </ENT> <ENT>14</ENT> </ROW> </GPOTABLE> <HD SOURCE="HD1">I. Statutory Authority</HD> This final rule is being issued under the authority granted to the Secretary of Health and Human Services by the Child Care and Development Block Grant (CCDBG) Act of 1990, as amended (42 U.S.C. 9857 <E T="03">et seq.</E> ), and section 418 of the Social Security Act (42 U.S.C. 618). <HD SOURCE="HD1">II. Background</HD> In response to requests from Tribal Leaders and Tribal Child Care and Development Fund (CCDF) Lead Agencies for more flexibility on family income eligibility to better meet community needs and to recent statutory changes to eligibility in the Tribal Head Start program, this final rule amends the CCDF regulations to provide all Tribal CCDF Lead Agencies the flexibility to serve Indian children (as defined by the Tribal Lead Agency) in their defined service area regardless of family income or assets. This final rule is also responsive to Executive Order 14112, <E T="03">Reforming Federal Funding and Support for Tribal Nations To Better Embrace Our Trust Responsibilities and Promote the Next Era of Tribal Self-Determination,</E> which directs agencies to “increase the accessibility, equity, flexibility, and utility of Federal funding.” This final rule provides Tribal Nations with more flexibility to better meet community needs, responds to calls for greater Tribal sovereignty and self-determination, and facilitates better alignment between Tribal CCDF and American Indian and Alaska Native (AIAN) Head Start programs. The CCDBG Act (42 U.S.C. 9857 <E T="03">et seq.</E> ), hereafter referred to as the “Act,” together with section 418 of the Social Security Act (42 U.S.C. 618), authorize the CCDF program, which is the primary federal funding source to Tribes, States, and Territories devoted to supporting families access to child care and to increasing the quality of child care for all children. CCDF plays a vital role in supporting child development and family well-being; facilitating parent employment, training, and education; and improving the economic well-being of participating families. In fiscal year (FY) 2024, 264 Tribal Lead Agencies representing 546 federally recognized Tribal Nations received CCDF grants totaling nearly $600 million. <SU>1</SU> <FTREF/> Annual Tribal CCDF awards range from $70,000 to $88 million per year. <FTNT> <SU>1</SU>   <E T="03">https://www.acf.hhs.gov/occ/data/gy-2024-ccdf-tribal-allocations-based-appropriations.</E> </FTNT> The Act does not explicitly apply most of its provisions to the Tribal CCDF program, so with some exceptions and within certain parameters, the Secretary of Health and Human Services has the authority to determine many of the CCDF requirements for Tribal Lead Agencies, including the family income and assets eligibility requirements for children to receive services from Tribal CCDF programs. Previous Tribal CCDF regulations included different family income and assets eligibility requirements and flexibilities based on a Tribal Lead Agency's award allocation size in FY 2016. Tribal Lead Agencies who had allocations under $250,000 in 2016 (155 Tribal Lead Agencies) could serve any Indian child (as defined by the Tribal Lead Agency) in their defined service area, regardless of family income or assets. However, Tribal Lead Agencies with allocations above $250,000 in 2016 were subject to the same CCDF income and assets eligibility standard as States, set forth at § 98.20(a)(2), which meant that family income could not be more than 85 percent of Grantee Median Income (GMI) and family assets could not exceed $1 million. This final rule extends the existing flexibility for Tribal Lead Agencies with small allocations to disregard family income and assets in determining family eligibility for CCDF to all Tribal Lead Agencies. All Tribal CCDF Lead Agencies may continue to use family income and/or assets criteria for eligibility at their option, but it will no longer be a requirement. Tribal Lead Agencies choosing to use family income or assets criteria for eligibility would have the flexibility to determine the appropriate threshold for their Nation. This final rule does not alter existing flexibilities that permit Tribal Lead Agencies with medium and large allocations to apply categorical eligibility criteria for families under certain conditions. This final rule will benefit Tribal Nations by better aligning family income eligibility rules in the Tribal CCDF with Head Start programs and providing necessary flexibility to determine how early childhood program family income or assets determinations can best support their communities. This alignment is particularly salient because many American Indian and Alaskan Native (AIAN) Head Start grant recipients administer a Tribal CCDF program. At the request of Tribal Nations and the Biden-Harris Administration, the Further Consolidated Appropriations Act, 2024 (Public Law (Pub. L.) 118-47, Div. D, Tit. II, Sec. 238) included changes to AIAN Head Start eligibility criteria, to make eligible for Head Start services all age-eligible children in an AIAN program's service area regardless of income. The Head Start Act, unlike the CCDBG Act, required legislative action to make this change. <HD SOURCE="HD2">Effective Dates</HD> This final rule will become effective on the date of publication to expedite Tribal Lead Agencies' ability to implement the flexibilities included in this final rule. <HD SOURCE="HD2">Severability</HD> The provisions of this final rule are intended to be severable, such that, in the event a court were to invalidate any particular provision or deem it to be unenforceable, the remaining provisions would continue to be valid. <HD SOURCE="HD1">III. Development of Regulation</HD> ACF published a notice of proposed rulemaking (NPRM) in the <E T="04">Federal Register</E> on July 16, 2024, (89 FR 57835) proposing revisions to CCDF regulations. We provided a 60-day comment period during which interested parties could submit comments in writing electronically. ACF received 18 comments on the proposed rule (public comments on the proposed rule are available for review on <E T="03">www.regulations.gov</E> ), including Tribal Nations and Tribal organizations, a state CCDF Lead Agency, non-profit and research organizations, parents, and individual members of the public. Public comments informed the development of content for this final rule. <E T="03">Tribal consultation and comments.</E> ACF is committed to consulting with Tribal Nations prior to promulgating any regulation that has Tribal implications. ACF held a formal consultation session virtually in August 2024 with Tribal leaders and authorized representatives to discuss the impact of the proposed regulations on Tribes. Tribes and Tribal organizations were informed of these events through formal letters to Tribal leaders and announcements to Tribal CCDF administrators. ACF also distributed materials specifically addressing the impact of the proposed rule on Tribes. ACF will publish a consultation report, which will be posted as a supplemental document in the <E T="04">Federal Register</E> and will include information on consultation attendees as well as their specific comments. During consultation, ACF received testimony from one authorized representative who expressed strong support for the proposed change. This final rule was informed by this testimony. In addition, prior to the development of the NPRM, OCC sought feedback from Tribal Nations and other interested parties on areas where more flexibility and/or different program rules would better serve children, families, and Tribal Nations through a formal Request for Information (RFI), published in the <E T="04">Federal Register ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 25k characters. 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