Child Care: State Efforts to Enforce Safety and Health		 
Requirements (09-SEP-04, GAO-04-786).				 
                                                                 
The federal government requires states that receive funds from	 
the Child Care and Development Fund to establish basic health and
safety requirements. The federal government also requires states 
receiving federal funds for child care to have procedures in	 
place to ensure that providers being paid with grant dollars	 
comply with the applicable safety and health requirements.	 
Because of the significant federal role in paying for child care 
services and congressional concerns about the way in which states
ensure the safety and health of children in child care settings, 
we were asked to follow up on our prior report, Child Care: State
Efforts to Enforce Safety and Health Requirements		 
(GAO/HEHS-00-28, Jan. 24, 2000). This report (1) identifies	 
changes in states' licensing and enforcement activities for	 
various types of licensed and nonlicensed providers since 1999,  
(2) describes the ways child care licensing agencies organize	 
inspection staff and use technology, and (3) provides examples of
promising practices in state child care licensing and enforcement
activities. To obtain data, we surveyed state licensing officials
in 2004 about their 2003 activities, interviewed experts and made
site visits to four states--Delaware, Florida, North Carolina and
Oklahoma.							 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-04-786 					        
    ACCNO:   A12236						        
  TITLE:     Child Care: State Efforts to Enforce Safety and Health   
Requirements							 
     DATE:   09/09/2004 
  SUBJECT:   Child care programs				 
	     Children						 
	     Performance measures				 
	     Strategic planning 				 
	     Licenses						 
	     Inspection 					 
	     Personnel management				 
	     Federal/state relations				 
	     Child welfare					 
	     Delaware						 
	     Florida						 
	     North Carolina					 
	     Oklahoma						 
	     HHS Child Care and Development Fund		 

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GAO-04-786

                 United States Government Accountability Office

GAO

Report to the
Honorable Sander M. Levin,
House of Representatives

September 2004

CHILD CARE

            State Efforts to Enforce Safety and Health Requirements

GAO-04-786

[IMG]

September 2004

CHILD CARE

State Efforts to Enforce Safety and Health Requirements

                                 What GAO Found

State efforts in the licensing and oversight of child care facilities are
generally about the same as they were in 1999, except that the median
caseload of the number of facilities per inspector dropped from 118 to 110
in 2003, as shown in the figure below. We found that in 2003, 38 states
exempted all family child care providers from being regulated, compared
with 39 states in 1999. Most states conducted compliance inspections at
least once a year, meeting or exceeding the recommended level for all
types of providers.

Many states organized inspection staff by geography and used technology in
many parts of the inspection process. Forty-three states reported
assigning staff to geographic locations throughout the state. States also
assigned staff based on specific job task and type of child care facility
the staff would inspect. Many states used multiple criteria to assign
staff. Forty-five states reported using technology to assist them with
many aspects of licensing and enforcement functions, such as maintaining
statistics on families and providers.

States have adopted a number of promising practices to assist their child
care licensing and enforcement activities. These practices include the use
of technology to streamline licensing and enforcement processes and manage
parent and provider information, rating systems to aid parents in
selecting the appropriate child care for their child and to offer
providers incentives to improve and maintain the quality of their care,
and working with other organizations to train providers and parents.

Median Caseload, Number of Facilities per Inspector, 1999 and 2003

Number of facilities 120 118

80

40

0 1999 2003

Source: GAO analysis of 1999 and 2004 surveys.

                 United States Government Accountability Office

Contents

Letter

Results in Brief
Background
Median Inspection Caseload Size Has Decreased since 1999

although Caseloads Have Continued to Exceed Recommended Levels

Many Inspection Staff Are Organized by Geographic Location, and Technology
Is Used in Most Parts of the Licensing and Inspection Process

Promising Practices in Technology, Rating Systems, and Training
Concluding Observations
Agency and Other Comments

                                       1

                                      3 4

                                       9

14 17 24 25

Appendix I Scope and Methodology

Appendix II State Caseloads, Fiscal Years 2003 and 1999

Appendix III	State Child Care Licensing Budget and Full-Time-Equivalent
Staffing Levels, 1999 and 2003

Appendix IV	Frequency of Licensure and Monitoring Visits in the States

Appendix V State Survey

Appendix VI	Comments from the Department of Health and Human Services 46

Appendix VII GAO Contact and Staff Acknowledgments 49

GAO Contact 49 Staff Acknowledgments 49

                            Related GAO Products 50

Tables                                                                  
                            Table 1: Types of Child Care                    6 
          Table 2: Recommended Practices for Critical Factors in Licensing 
                                  and Enforcement                           8 
             Table 3: Types of Providers State Licensing Agencies Reported 
                     They Regulated or Exempted, 1999 and 2003             11 

Figures

Figure 1: Caseload Ranges for State Licensing Staff, 2003
Figure 2: Thresholds for Regulation, as Represented by Number of

Children Cared For in Family Child Care, 1999 and 2003 Figure 3: Number of
Inspection Visits Per Year, 1999 and 2003 Figure 4: Number of States Using
Various Criteria to Assign

Inspection Staff in 2003 Figure 5: How States Use Technology

                                       10

                                     12 13

                                     15 16

Abbreviations

ACF Administration for Children and Families
CCDF Child Care and Development Fund
EBT electronic benefits transfer
FTE full-time-equivalent
HHS Department of Health and Human Services
NAEYC National Association for the Education of Young Children
NARA National Association for Regulatory Administration
NCCIC National Child Care Information Center
NHSPS National Health and Safety Performance Standards
R&R resource and referral
TANF Temporary Assistance for Needy Families

This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
its entirety without further permission from GAO. However, because this
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separately.

United States Government Accountability Office Washington, DC 20548

September 9, 2004

The Honorable Sander M. Levin House of Representatives

Dear Mr. Levin:

The need for child care has grown dramatically over the past 25 years. In
1975, 39 percent of women with children under the age of 6 were in the
labor force; by 2003 that number had grown to 63 percent. Since 1996,
federal welfare policies have emphasized the importance of work, and more
welfare parents than ever before have moved into the workforce. The
federal government assists the work efforts of parents through the Child
Care and Development Fund (CCDF), providing $4.8 billion to states to help
parents pay child care costs and to ensure the health and safety of
children in child care. More than 1.75 million children are enrolled in
subsidized care each month.

To help protect children in child care, states license certain child care
providers and establish requirements including those focused on health and
safety. All states set licensing requirements and require some child care
providers to obtain a license to offer care. However, as allowed, most
states do not license all types of providers in all child care settings.
Both licensed and nonlicensed providers are eligible to receive funds from
CCDF, and the federal government requires states to have plans in place to
ensure that providers being paid with federal child care funds comply with
the applicable health and safety requirements established by the states.
Many of the health and safety requirements states establish are based on
practices, including inspections, recommended by national organizations.1

To ensure compliance with states' licensing requirements, states oversee
those child care providers over which they have authority by engaging in

1These organizations include the National Association for the Education of
Young Children (NAEYC), which is an organization of early childhood
educators dedicated to improving the quality of child care programs, and
the collaboration of the American Academy of Pediatrics, the American
Public Health Association, and the National Resource Center for Health and
Safety in Child Care and the Maternal and Child Health Bureau, Health
Resources and Services Administration, Department of Health and Human
Services, which puts out the National Health and Safety Performance
Standards..

various enforcement activities. The most intense enforcement activities
occur for licensed providers, the most highly regulated status for
providers. Licensed providers are typically subject to background checks
and facilities inspection, provided with technical assistance and
training, and are subject to sanctions-such as fines and revocation of
licenses- for those who do not meet licensing standards. Licensed
providers who receive subsidies have the most stringent requirements. For
nonlicensed providers, states' laws and policies dictate the extent to
which states engage in such enforcement activities. Consequently, some
nonlicensed providers receive less intense oversight than do licensed
providers, but are still subject to regulation (we will call these
regulated nonlicensed providers). Still other providers are exempt from
state regulation because of state law. For example, in certain states
child care centers run by religious organizations are exempt from
regulation. Exempt providers who receive federal child care funds must
comply with state health and safety requirements. Parents can choose among
a number of different child care settings. Some parents may choose to send
their child to a child care center, where many children are cared for in a
nonresidential setting. Other parents may choose a "family" care setting,
in which one provider cares for a number of children within the provider's
home.

Because of the significant federal role in paying for child care services,
some members of Congress raised concerns about the way in which states
ensure the safety and health of children in child care settings. In 1999,
we surveyed states to identify the most critical licensing and enforcement
activities.2 We were asked to update our 1999 study, and in this report we
(1) identify any changes in states' licensing and enforcement activities
for various types of licensed and nonlicensed providers since 1999, (2)
describe the ways child care licensing agencies organize inspection staff
and use technology, and (3) provide examples of promising practices in
state child care licensing and enforcement activities.

To address these issues, we conducted a mail survey in 2004, to state
licensing officials in all 50 states and the District of Columbia, asking
about their licensing and enforcement policies and practices in 2003.
Specifically, we asked states to report on the frequency of their
compliance inspections, background checks, training programs and
educational requirements for licensing staff, and caseload sizes. We

2GAO, Child Care: State Efforts to Enforce Safety and Health Requirements,
GAO/HEHS-00-28 (Washington, D. C.: Jan. 24, 2000).

achieved a response rate of 98 percent, with 49 states and the District of
Columbia responding to our survey.3 We then compared our survey results
with a mail survey we conducted in 1999 to identify any changes that had
occurred within the past few years. We also used data from the National
Child Care Information Center for the number of states exempting family
child care providers from regulation. In addition, we conducted a
literature search and interviewed child care licensing experts and state
and federal officials to gather information about critical licensing and
enforcement activities occurring within the states. We asked experts to
identify states that had examples of promising practices in automation,
training initiatives, rating systems for providers, and enforcement
practices. We used this information to identify four states-Delaware,
Florida, North Carolina and Oklahoma-in which we conducted site visits.
For more details on our scope and methodology, see appendix I. We
conducted our work between October 2003 and July 2004 in accordance with
generally accepted government auditing standards.

                                Results in Brief

Most licensing and enforcement activities for regulated providers remained
about the same in 2003 as they had been in 1999 except the median caseload
for inspectors decreased. Almost a quarter of the states maintained
caseload levels recommended by national organizations (75 child care
facilities to one inspector), but the number of states with particularly
high inspector caseloads, over 150 to one, dropped from 17 to 15, and the
median caseload dropped from 118 to 110. About the same number of states
exempted family child care providers from being regulated in 2003 (38) as
in 1999 (39). States continued to conduct compliance inspections as
recommended and to exempt some providers from licensing. For example, most
states reported conducting compliance inspections at least once a year,
meeting or exceeding the recommended level for all types of providers, and
all states provided training for providers. However, only 4 states
required the 24 hours of training per year recommended by national
professional organizations. Finally, state monitoring of exempt providers
continued to be limited in many states to distributing information about
health and safety requirements and asking these providers to certify that
they complied with state requirements. However, the number of states
conducting background checks and inspections of exempt providers increased
between 1999 and 2003, from 20 to 37 respectively.

3Maine did not respond.

Most states reported organizing inspection staff by geography and using
technology in many parts of the licensing and inspection process.
Fortythree states reported assigning staff to geographic locations
throughout the state. Nineteen states also reported assigning staff based
on a specific job task, such as responding to complaints or inspecting a
particular type of child care facility. Some states used multiple criteria
to organize their staff. For example, some assigned staff first by
geographic location and then, within that location, assigned by type of
provider. Forty-five states also reported using technology to assist them
with many aspects of licensing and enforcement activities. Those uses most
frequently reported by states were to maintain statistics on providers (34
states), prepare reports (28 states), make and reconcile payments (25
states), and track and monitor subsidy use (25 states).

The 4 states we visited have adopted a number of promising practices to
assist in their enforcement activities. For example, Florida used
technology to streamline its licensing and enforcement processes and to
manage parent and provider information particularly effectively. Florida
licensing staff used laptops for entering inspection information at the
child care facility and linked child care-related databases. Three states
we visited have implemented rating systems that differentiate providers by
the quality of care they provide: North Carolina, Oklahoma, and Florida.
Such systems have helped parents choose child care providers by allowing
them to compare the quality of different providers. In addition, ratings
systems have offered providers incentives to improve and maintain the
quality of their care. For example, North Carolina used a five-star rating
system, which reimbursed providers that had more stars (indicating higher
levels of quality) at higher rates for subsidized children than providers
with fewer stars. Promising practices were also seen in training programs
for providers and parents in Delaware, Oklahoma, and North Carolina, which
had in common statewide systems of interconnected partnerships between
state and community agencies to ensure quality child care and alignment of
their training programs with state standards and requirements.

Background 	States are responsible for developing licensing criteria and
health and safety requirements and conducting enforcement activities to
ensure providers comply with them and thereby protect the safety and
health of children in child care settings. While the federal government's
role is limited in this area, the states must certify that they have
safety and health requirements in place and procedures to ensure providers
comply with all applicable requirements to receive federal CCDF funds. The
Department of Health and Human Services (HHS) oversees CCDF.

CCDF Funding and Requirements

In fiscal year 2003, the amount of federal funds appropriated for CCDF was
$4.8 billion.4 The CCDF funds are provided to states through a block grant
mechanism which allows states to set priorities, establish policies, and
spend funds in ways that will help them achieve state child care goals.
The Child Care and Development Block Grant statute that underlies the CCDF
requires states to designate a lead agency and to establish state plans
that commit to establishing and enforcing licensing requirements and
health and safety standards for child care providers. The statute leaves
it to the states to decide what requirements are to be applicable to
specific categories of providers, but for health and safety it sets out
three broad parameters that must apply to all providers receiving federal
assistance:5 physical premises safety, staff training, and control of
infectious diseases (including childhood immunizations). To qualify for a
subsidy provided with funds from the CCDF, a provider must comply with
these and any other applicable state requirements.

To be eligible for CCDF subsidies, parents must be working, in training,
or attending an educational program and have children less than 13 years
of age.6 States can set income eligibility limits at or below 85 percent
of the state median income level. States must use a significant portion of
their CCDF funds for families receiving Temporary Assistance for Needy
Families (TANF) or families who are at risk for becoming dependent upon
public assistance.7 CCDF has five goals: (1) encouraging maximum
flexibility in developing state child care programs; (2) promoting
parental choice; (3) encouraging states to provide consumer education
information to parents; (4) helping states provide child care to parents
trying to become independent of public assistance; and (5) helping states

4The total amount of federal CCDF funding comes from two sources: the
Child Care and Development Block Grant Act of 1990 and Section 418 of the
Social Security Act. These two statutes and their funding sources are
administered as a unified program-known as CCDF-subject to the
requirements of the Child Care and Development Block Grant. Up to 30
percent of federal funds states receive under the Temporary Assistance for
Needy Families (TANF) program can be transferred to CCDF and the Social
Services Block Grant at the state's discretion. Funds transferred to CCDF
are to be administered under the rules of CCDF. States may also use TANF
directly to fund child care.

5The requirements do not apply to relative providers as defined in the
regulations, usually grandparents or siblings.

6States can serve children with special needs under age 19.

7More specifically, states must use at least 70 percent of the CCDF funds
authorized under the Social Security Act for families receiving TANF,
transferring off TANF, or families who are at risk for becoming dependent
upon public assistance.

implement health, safety, licensing, and registration standards
established in state regulations. However, CCDF does not specify how the
states should meet these goals and only requires them to be included as
elements within the state child care plan. States can also determine which
enforcement activities apply to different types of child care. Types of
child care eligible to receive funding under TANF and the block grant are
described in table 1.

Table 1: Types of Child Care

                                Type Description

                 In-home care Care provided in the child's home

Relative care 	Care provided by someone related to the child other than
the parents in any setting, typically in the child's or relative's home

Family child care 	An individual provider who provides child care services
as the sole caregiver in a private residence other than the child's home

Group home care 	Two or more providers who provide child care services in
a private residence other than the child's home (this does not include
24-hour residential facilities)

Child care centers Nonresidential facilities that provide care for
children and include

full- and part-time group programs, such as nursery and preschool
programs. Child care centers can be commercial, work-site based,
school-based (preschool or after school), or a recreational program (such
as camps or parks), and care can also be run by a religious organizations
or by federal, state, or local governments

                            Source: GAO/HEHS-00-28.

Oversight of Child Care Providers

States regulate those providers over which they have authority by setting
requirements, including those focusing on health and safety, that such
child care providers must meet and by enforcing these requirements. 8
State child care licensing offices are responsible for enforcing such
health and safety requirements, and engage in different oversight
activities for licensed providers and for regulated nonlicensed providers.

o  	Licensed providers are generally subject to standard oversight, which
generally includes background checks, inspections, technical assistance
and training, and the application of sanctions when providers are found to
be out of compliance. 9

8Some states are prevented by state law from regulating certain types of
providers.

9According to the National Child Care Information Center (NCCIC), not all
states require background checks for all providers.

o  	Regulated nonlicensed providers receive less intense oversight. Such
oversight can include self-certification that health and safety standards
have been met, background checks, and sanctions.

o  	Providers who are legally exempt by state law from oversight are not
regulated by state child care licensing offices. For example, in certain
states, child care centers run by religious organizations may be exempt.
In addition, under federal regulations, the states are not required to
apply health and safety requirements to certain providers who only care
for a child to whom they are related. Some states may conduct background
checks and inspections of their legally exempt providers.

States vary as to which types or subtypes of child care providers fall
under each level of oversight.10

When establishing which providers will be required to obtain licenses, and
hence be subject to standard oversight, and which will be required to
comply with less intense requirements, states consider a number of
factors. For example, states consider whether certain providers are
subject to other health and safety regulating authorities, such as
schoolbased programs that must conform to all health and safety
requirements required for public schools and are overseen by the state
education department. States also consider the staffing resources they
would need to carry out the necessary licensing and enforcement activities
in light of their budget, how to target resources toward the greatest
number of children, and the impact that licensing activities could have on
child care availability and parental choice. For example, some providers
might pass the costs of conforming with licensing requirements on to
parents, which could make such care too expensive for some parents.
Currently, states are making choices about the extent to which they
license certain providers and about which enforcement activities apply to
different types of providers.

10Subtypes of group or family homes are defined by the number of children,
with each state setting a threshold. Subtypes of centers include
commercial, religious, school-based preschool, school-based after-school,
recreation, work site, centers run by the federal government, and centers
run by state or local government.

Licensing and There are no specified federal requirements for licensing
and enforcement Enforcement Activities activities, so many states rely on
recommendations made by professional Recommended by National organizations
in developing their own standards. Professional

organizations recommend standards for several critical licensing and

Organizations 	enforcement activities, including background checks,
monitoring visits, training for licensing staff, and caseload size. Table
2 outlines recommended practices for critical licensing and enforcement
activities.

Table 2: Recommended Practices for Critical Factors in Licensing and Enforcement
                     Critical factors Recommended practice

Background checks	Before granting a license, every state should obtain a
criminal record check and child abuse registry check for anyone who has
any contact with children in a facility and those family members in a
family child care home who are over 10 years of age Monitoring visits
(inspections) Centers and group homes should receive at least one
unannounced inspection per year

Training for licensing staff 	Staff should have appropriate education and
experience for the form of child care they are assigned to inspect. They
should receive no less than 40 hours of orientation training upon
employment and an additional 16 hours of training about child abuse. In
addition, they should receive at least 24 hours of continuing education
each year

Caseload size 	On average, each staff person's caseload should consist of
no more than 75 provider facilitiesa

Source: American Academy of Pediatrics, American Public Health
Association, National Resource Center for Health and Safety in Child Care
and Maternal and Child Health Bureau, Health Resources and Services
Administration, Department of Health and Human Services. Caring for Our
Children: National Health and Safety Performance Standards: Guidelines for
Out-of-Home Child Care, 2nd Edition. (Washington, D.C.: 2002) and NAEYC,
Licensing and Public Regulation of Early Childhood Programs: A Position
Statement (Washington, D.C: 1997) at
http://nrc.uchsc.edu/CFOC/XMLVersion/Appendix_AA.xml.

Note: For each factor we used either the National Association for the
Education of Young Children (NAEYC) or National Health and Safety
Performance Standards recommendation, but not both, because in some cases
one of the documents did not cover a particular enforcement activity or in
other instances, the recommended practice was not specific enough.

aNAEYC recommends 50 as a more desirable number.

  Median Inspection Caseload Size Has Decreased since 1999 although Caseloads
  Have Continued to Exceed Recommended Levels

In 2003, the median caseload size for inspectors decreased, but most
licensing and enforcement activities for licensed providers remained about
the same as those in 1999. Almost a quarter of the states maintained
caseloads at recommend levels, and fewer states had caseloads levels over
150. Most states conducted compliance inspections at least once a year,
which met or exceeded the recommended level for all types of providers.
However, most states do not require the amount of training recommended by
national professional organizations. Most states continued monitoring
exempt providers by distributing information about health and safety
requirements and asking these providers to certify that they complied with
state requirements, although some states engaged in more intense
monitoring practices for these providers.

Almost One-Quarter of the States Maintained Recommended Caseload Levels
for Inspectors, and Median Caseloads Decreased

In 2003, almost a quarter of the states maintained caseloads at or below
the recommended level of 75 facilities to one inspector, and the number
doing so had increased by 1 since 1999. Specifically, in 1999, 11 states
were meeting the recommended caseload levels, and that number increased to
11 states and the District of Columbia by 2003. The median number of
facilities per inspector decreased during this time, from 118 facilities
per inspector to 110 facilities per inspector, but the number of
facilities per inspector was still well above the recommended level of 75
in 2003. In 1999, caseloads ranged from 52 in Missouri to 333 in Colorado,
while in 2003, caseloads ranged from 35 per inspector in Hawaii to 600 per
inspector in Iowa. Although the range was broader in 2003 than in 1999,
more states decreased the size of their caseloads than increased them.
Between 1999 and 2003, the caseload in 23 states and the District of
Columbia decreased while the caseload in 16 states increased. The number
of states with particularly high caseloads, over 150, dropped from 17 to
15, between 1999 and 2003. Among the states whose caseloads decreased were
several states with the some of the highest caseloads in 1999. For
example, Colorado's caseload went from 333 to 138 as its licensing budget
nearly doubled. Figure 1 illustrates the ranges of caseload levels of
licensing staff by state in 2003; see appendix II for a comparison of
caseload by state in 1999 and 2003 and appendix III for comparisons of
licensing budgets and staffing levels by state in 1999 and 2003.

Figure 1: Caseload Ranges for State Licensing Staff, 2003

Source: GAO analysis of state survey, 2004.

While state data showed 12 states maintaining caseloads at recommended
levels, states reported that they were visiting facilities as often as
recommended, and in 15 states, more often. States may be managing to visit
facilities as often as recommended while maintaining caseloads higher than
those recommended, in part because the caseload standard itself is not
appropriate for some states. Experts note that this standard does not
fully account for time-saving technology that might allow some states to
operate effectively with larger than recommended caseloads. Further,
licensing staff could be making trade-offs not captured in our survey. For
example, staff could be maintaining their schedule for monitoring visits
at the expense of performing other duties, including processing
applications, providing technical assistance, or documenting inspection
visits in a timely manner.

The Number of States Exempting Some Family Child Care Remained about the
Same

According to the data reported through state surveys and NCCIC, one less
state exempted family child care providers--sole caregivers who care for
children in a private residence other than the child's-than were exempted
from health and safety requirements in 1999. In 1999, 39 states exempted
some family child care providers from regulation, and by 2003, 38 states
were exempting some of these types of providers. In addition, fewer states
required licensure for some types of centers in 2003 than had in 1999,
including religious centers, federal centers, and recreation centers. See
table 3.

Table 3: Types of Providers State Licensing Agencies Reported They Regulated or
                   Exempted, 1999 and 2003 Number of statesa

Regulated

                        Licensed Regulated, nonlicensedb

Exempted from state regulationc

Type of provider 1999 2003 1999 2003 1999

                      Family child care 30 35 18 16 39d38d

Group homes 35 356 6 2

Centers

             Commercial               47       46       2       3       0     
              Religious               43       39       7       8       3     
       School-based preschool         27       31       5       6       11    
      School-based after-school       33       35       4       5       13    
             Recreation               18       14       1       4       20    
              Work site               46       44       3       4       1     
               Federal                20       14       2       8       21    
             State/local              38       39       5       4       6     

Source: GAO analysis of 1999 and 2003 state surveys and NCCIC.

aThe sum of the number of states for each year for each type of provider
may not equal 50, either because states may have licensed or regulated
some subtype of provider but not others or because a state may not have
provided data for certain categories.

bRegulated, nonlicensed providers are also known as registered or
certified providers. Registered or certified only includes those providers
regulated by the state licensing agency. Providers can also become
voluntarily regulated or regulated by another state or local agency.

cThe state exemption does not extend to providers of child care for which
federal assistance is provided. By federal regulation, these providers are
subject to state health and safety regulations.

dThis is the number of states that exempted some family child care
providers.

Many states set thresholds at which regulation begins according to the
number of children served by different types of providers and exempt from
regulation those providers falling below these thresholds. For example,
states commonly determine which family child care providers

will be regulated based on the number of children in care. Specifically,
in a given state, providers caring for 7 or more children in their home
might be regulated, while providers caring for 4 children in their home
might be exempted from regulation. As figure 2 illustrates, these
regulatory thresholds have changed very little since 1999. However, 18
states met or exceeded the recommended practice of regulating providers
who cared for 2 or more unrelated children in 2003, whereas 13 were doing
so in 1999.11

Figure 2: Thresholds for Regulation, as Represented by Number of Children
Cared For in Family Child Care, 1999 and 2003

Number of states 20

                                       18

15

10

5

0 1a 2b 3 to 4 5 or more Number of children

1999 2003 Source: GAO analysis of state survey, 1999, and NCCIC, 2003.
aStates in this category would exceed NAEYC's recommended practice of
regulating providers who care for 2 or more unrelated children.

bStates in this category would meet NAEYC's recommended practice of
regulating providers who care for 2 or more unrelated children.

11NAEYC recommends regulating providers who care for two or more unrelated
                                   children.

Inspections Still Conducted in Accordance with Recommended Practices, but
Most States Short of Recommended Hours of Training

Although some changes had occurred since 1999, states continued to conduct
compliance inspections in accordance with recommended practices of
conducting compliance inspections at least once a year. However, the
number of states that visited facilities at least twice a year dropped by
about half for all types of settings. According to the data reported to us
through our survey, 41 states inspected centers at least annually, and 32
states did so for group homes. Similarly, 28 states conducted inspection
visits to family child care homes at least once a year. See figure 3 and
appendix IV.

Figure 3: Number of Inspection Visits Per Year, 1999 and 2003

Number of states

30 29

25

                                       23

20 19

15

10

5

0

             Less At      At    Less At    At    Less     At       At 
           than least   least    than    least   than   least   least 
                                 least                         
           once once    twice  once once twice   once    once   twice 
             a year a   a year a year a  a year a year  a year a year 
               year            year                            
           Family child          Group                         
               care              homes          Centers        

1999

2003

Source: GAO analysis of state surveys, 1999 and 2004.

The number of states requiring providers to pursue ongoing training
increased from 26 in 1999 to 29 in 2003, and as in 1999, the same number
of states (4) specifically followed the recommended practice by requiring
at least 24 hours of training per year for center directors, and 3 states
required this of center teachers. No states required this level of
training for family child care providers. The same number of states (32)
required

licensing staff to have an academic degree in a related field in 1999 and
2003. Similarly, in 1999 and 2003, the same number of states (33) required
licensing staff to have work experience in licensing or a related field
before being assigned to licensing and enforcement activities. Finally,
although very few states had required licensing staff to pass a test in
1999 (7), even fewer required this in 2004 (3).

Many States Engage in Enforcement Activities for Exempt Providers
Receiving Child Care Subsidies

  Many Inspection Staff Are Organized by Geographic Location, and Technology Is
  Used in Most Parts of the Licensing and Inspection Process

More states informed exempt, subsidized providers about the requirements
under the federal grant by sending them a package of information about
health and safety requirements in 2003 (32) as reported doing so in 1999
(28). In addition, 17 states reported informing providers by requiring
them to attend a short briefing or orientation sessions. Of these, 13
states both sent them a package of information and required attendance at
a briefing or orientation.

In monitoring providers exempted from regulation who were receiving CCDF
funds, states exercised the wide discretion given them by the grant in
determining how, or whether, to enforce state and local safety and health
requirements for such providers. Some states monitored such providers
relatively intensely, while others did not have the authority to do so
under state law. For example, some states conducted background checks on
exempt providers or inspected such providers. The number of states
conducting background checks and inspections for such providers increased
since 1999. For 2003, 37 states reported conducting background checks on
exempt providers, compared with 20 in 1999. Similarly, for 2003, 12 states
reported conducting inspections for such providers compared with 6 in
1999. Finally, for 2003, 9 states reported conducting both background
checks and inspections, while 4 states reported doing so in 1999.

While 43 states assigned staff to a geographic location, those states
using this broad method varied in the specifics of such assignments.
Nineteen states also reported assigning staff based on specific job task,
such as responding to complaints. Nineteen states reported assigning staff
to inspect a particular type of child care facility, such as centers or
family homes. Some states used multiple criteria to organize their staff;
these states frequently first assigned staff based on geographic location
and then relied on secondary criteria, such as type of child care
facility. See figure 4.

Figure 4: Number of States Using Various Criteria to Assign Inspection
Staff in 2003

                             Geographic location 43

Specific job tasks

Child care facility type

Discretion of local/regional offices

Othera

0 5 101520253035404550

Number of states Source: GAO analysis of state survey, 2004.

aOther includes four states that indicated they used no criteria to assign
staff.

Note: States can list more than one criterion.

Forty-five states reported using technology to assist them with many
aspects of licensing and enforcement activities. States used technology
for tracking and monitoring subsidy use, inspecting facilities, making and
reconciling payments to providers, linking state and local agencies,
maintaining statistics on providers, maintaining statistics on families,
and preparing reports to meet federal and state mandates. See figure 5.

Figure 5: How States Use Technology

Maintaining statistics on providers

34

Preparing reports to meet federal and state mandates

Tracking and monitoring subsidy use

Making and reconciling payments

Facility inspection checklist

Maintaining statistics on families

Linking state and local agencies

Other

0 5101520253035

Number of states

Source: GAO analysis of state survey, 2004.

Note: States can list more than one use of technology.

Technology to complete some of these tasks was available in only a limited
number of locations, such as the state licensing office, while for other
tasks the technology could be accessed anywhere in the state by authorized
users. More states had the ability to maintain statistics on providers and
families (24 states) and preparing reports to meet federal and state
mandates (20 states) statewide than for any other tasks (tracing and
monitoring subsidy use (18 states), making and reconciling payments (17
states), facility inspection checklist (16 states) or linking state and
local agencies (12 states)).

  Promising Practices in Technology, Rating Systems, and Training

States we visited have adopted a number of promising practices to assist
in their child care licensing and enforcement activities. First, some
states used technology in ways that allowed them to streamline their
licensing and enforcement processes and to manage parent and provider
information particularly effectively. Second, the states we visited had
paired frequent inspections with technical assistance to help ensure that
child care providers would meet state health and safety regulations.
Third, three states we visited had implemented rating systems that
differentiate providers by the quality of care they provide. Such systems
have helped parents choose child care providers by allowing them to
compare the quality of different providers. In addition, these systems
have helped states determine what training and technical assistance each
provider needs and have offered providers incentives to improve and
maintain the quality of their care. Fourth, all the states we visited
encouraged partnerships with community organizations to improve the
training and education of providers. For example, states partnered with
community colleges to connect providers with educational opportunities and
with resource and referral agencies to meet the ongoing training needs of
providers.

States Can Use Technology to Make Critical Licensing and Enforcement
Activities More Accessible and Efficient

States we visited used technology to make licensing and enforcement
information more readily available to providers and parents, save time and
resources, and track payments and subsidy use. For example, Florida-the
state with the most complete, integrated, and up-to-date technology system
of the states we visited-used technology to create an online public
information system for providers and parents. Providers can use this
system to access online information about state policies and regulations,
training requirements, how to start a center, and other information. This
has helped providers increase professionalism and selfmonitoring,
according to state officials. Parents can use the system to access the
compliance histories of each provider.

In addition, some states have used technology to make critical licensing
and enforcement activities more efficient. For example, Florida's
Internetbased system allows providers to register for training online and
access their transcripts and final examination results. Florida officials
also told us that posting provider information online reduced the amount
of time child care licensing staff had to spend answering questions from
providers and consequently allowed them to spend more time on other
enforcement activities.

Two states we visited-Florida and North Carolina-have used laptops to make
the enforcement process more efficient.12 Specifically, in these states
inspectors were able to enter data into their laptops while conducting
inspections rather than having to enter this information into the computer
after returning to the office. In addition, inspectors in Florida were
able to print a copy of the compliance report for providers while on-site
to facilitate discussions of areas needing improvement. The laptops also
saved inspectors time by allowing them to quickly access provider
information, state child care regulations, noncompliance citations, and
inspection forms. Officials in both Florida and North Carolina said that
using laptop computers had helped inspectors spend less time on
administrative duties and allowed them to spend more time providing onsite
technical assistance to providers. The project coordinator in Florida said
that this system which only covers child care licensing, was more
affordable than other states' licensing systems, which are part of their
larger statewide child welfare information systems.13

In another state, technology was used to make it easier for providers and
parents to manage subsidy payments and reduced the likelihood of fraud or
overpayment. Specifically, Oklahoma reported using an electronic benefits
transfer (EBT) system to automatically calculate payment rates and to
track subsidy use. Because Oklahoma reimburses providers at over 160
different rates depending upon the characteristics of the family and
provider receiving a subsidy, the likelihood of error had been
significantly higher before the system was implemented, when licensing
staff were responsible for identifying the appropriate rate. According to
state officials, this system has saved time processing paperwork. Further,
the EBT system has allowed parents receiving a child care subsidy to
document the time and attendance for their children using an EBT card
issued by the state, and providers are automatically reimbursed at the
appropriate rate.14 This automated system has also has also helped

12Florida's system has been in place since 2002. North Carolina is
currently piloting a similar system.

13According to data provided by the program coordinator, Florida's new
system of 120 laptops with related equipment, software, training, help
desk and support contract, cost about $700,000 for the whole state. Annual
costs of supporting the licensing component of their system have run about
$400,000 to $500,000.

14The card covers the subsidized amount for that parent. The parents also
have to give the provider a copayment to cover the full costs. The same
EBT card can be used for food stamps and TANF benefits if the family
qualifies for those benefits.

officials identify instances of child care fraud and payment abuse,
according to state officials.

We found that in the states we visited, only those that had recently
invested in computer systems, such as Florida, had been able to take
advantage of new technologies at an affordable price. In contrast, other
states that had not recently invested in computer systems, such as
Delaware, had been unable to adopt such promising practices. Specifically,
although Delaware had been on the leading edge of using technology almost
a decade ago, it had been unable to maintain this advantage. One state
official said that it is costly to implement and maintain the technology
necessary to support facilities inspection, particularly when the state's
system is relatively old and needs to be updated. For example, Delaware's
system was designed in 1995 to help staff investigate child abuse, but was
being used in 2003 to track the licensing process. According to state
officials, the system was difficult to use for management purposes. To
upgrade the system to adopt promising practices such as entering data
while conducting on-site inspections, the state would need to develop the
system and obtain additional equipment, such as laptop computers. However,
officials told us that despite the increases in the state licensing budget
since 1999, the state does not have the funding to upgrade the system and
purchase additional technological equipment because these funds had been
for specific purposes, such as staffing and infant and toddler programs.

Rating Systems Helped Parents Choose Child Care and Offered Providers
Incentives to Improve and Maintain the Quality of Child Care

Florida, North Carolina, and Oklahoma have implemented rating systems to
tie the level of reimbursement to a provider's quality.15 These rating
systems helped create a market system by giving parents more information
about the quality of child care providers, and offered incentives to
providers to obtain higher levels of education and improve quality in
their facilities. In implementing rating systems, states set standards for
different tiers of quality and assessed providers against these standards.
The lowest tier included those providers who only met the state licensing
criteria, while the highest tiers in Florida and Oklahoma included those
providers who have achieved accreditation by national organizations.
States differ in

15Delaware has a rating system in draft form.

the number of tiers in their systems: North Carolina has five, Oklahoma
has four, and Florida has two tiers.16

Ratings systems have helped parents choose child care providers by
allowing them to compare the quality of different providers. While some
parents might not have known whether national accreditation would mean
higher-quality care, they can easily identify that a provider with five
stars was considered to provide better quality than a provider with one
star.

Rating systems also offered providers incentives to improve and maintain
the quality of their facilities by offering higher levels of reimbursement
to higher-quality providers. For example, through the star rating systems
in North Carolina and Oklahoma, providers with more stars received a
higher rate of reimbursement than providers with one star. Similarly, in
Florida high-quality providers also receive financial incentives such as a
reimbursement rate for subsidized children that is 20 percent higher than
the market rate, a tax break for high-quality providers whose clientele
does not include subsidized families, and an exemption from sales tax on
educational materials. Officials in Oklahoma said that the rating system
has provided incentives to all providers to improve the quality of their
care, even providers who do not serve subsidized children. Such providers
use the star rating as a marketing tool for their facilities, according to
state officials.

Finally, the rating systems-and the standards and indicators of quality on
which they are based-can help states focus their child care quality
efforts. For example, North Carolina's five-star rating system forms the
core of all its child care quality efforts, according to state officials.
The Stars program provided the criteria for identifying areas in which
individual centers needed to improve and the steps centers could take to
obtain a higher rating, the basis for developing and providing full-day
professional development and workshops throughout the year, and links with
financial supports to encourage and reward participation in professional
development that could lead to higher-quality child care.

16The two tiers are at the state level. Local agencies in Florida may have
additional tiers for reimbursement tied to quality issues.

Training

Prelicensing and New Providers Training

Staff Development Training

Training is an integral part of ensuring and upgrading the quality of
early childhood education for all the states we visited. We found
promising practices in training and information programs for providers and
parents. Training and information for providers includes information on
starting up a facility and program standards that may be available in
information packages or on the Internet; orientation training; technical
assistance; staff development courses; conferences, and model observation
training sites. Parent information services includes providing information
on what to look for when evaluating child care providers, as well as
related information on vaccinations, screening and playground safety and
where to access parent support services. Delaware, North Carolina, and
Oklahoma were cited by experts as having notable training programs.17 What
they have in common is that each training program is part of a total
statewide system of interconnected partnerships between state and
community agencies to ensure quality early childhood care.

In these three states, licensing officials offered prelicensing training
so that potential providers could get information on state requirements to
avoid being out of compliance. In Delaware, staff from the Family &
Workplace Connection, which is the umbrella organization that provides
both training and resource and referral (R&R) services and offered a wide
range of training opportunities that included some technical assistance,
also attended new provider orientations given by the licensing office, to
meet these providers and inform them of other services they supply, like
the food program, which can furnish free food to providers, or grant
opportunities. According to one official, these supports helped providers
understand the health and safety requirements, which in turn helped
facilitate compliance. In Delaware, inspectors also walked new providers
through the health and safety regulations and addressed providers'
questions or concerns on their first walk-through of the facility.

The bulk of training for providers was provided by training
organizations-community colleges, early education training centers, some
R&R agencies, and universities-working in partnership with the licensing
offices for ongoing staff development. Such training is designed to help
providers meet ongoing training requirements and provide them with
technical assistance so they can improve the quality of their care by

17Although Florida's new training system appears to have the same
comprehensive structure as the other states we visited, we did not closely
examine it because Florida was not initially cited as having a model
training program by experts we interviewed.

engaging in training programs aligned with state standards and
requirements. Oklahoma, North Carolina, and Delaware pursued different
strategies to implement this alignment, and Florida demonstrated how a
comprehensive Internet information system saves time for providers,
training organizations, and state officials.

o  	Oklahoma's three-tiered training program comprehensively addresses all
training needs from meeting minimal requirements for child care licensing
to the most advanced professional development for early care and education
workers and center directors. Tier I is short-term, job-related training
that can be counted toward ongoing training requirements. Providers can
pursue Tier I training by attending workshops or conferences related to
their job, watching videos, and self-directed reading, and by
participating in in-service training. Tier II is in-depth training that
providers engage in by completing courses approved by the state's Center
for Early Childhood Professional Development. Tier III training is
advanced training, formal education through credit-bearing courses at
accredited colleges, universities, and technology centers that transfer
for credit to such schools, leading to the highest levels of the quality
enhancement star system, the career development ladder, and the Oklahoma
director's credential.

o  	North Carolina has woven its provider training into its comprehensive
Smart Start program, which is a recognized national model of partnerships
working together to meet the needs of young children. As part of this
program, the education level of staff is one of three areas on which
providers are evaluated when their quality rating is determined.18
Providers

who meet higher standards for education and experience receive more stars
because, according to state officials, child care teachers with more early
childhood education and experience are prepared to provide children with a
more enriching child care experience. Providers can improve their star
rating by increasing staff education and experience levels and by
employing more teachers with early childhood education credentials and
experience. Providers can pursue such credentials by completing
certificate or higher education programs offered at community colleges and
universities. Such training activities are facilitated and coordinated by
the North Carolina Institute for Early Childhood Professional Development.

18The others areas are program standards and compliance history, i. e.,
how well the program adhered to the rules.

                    Page 23 GAO-04-786 Child Care Licensing
     Delaware      professionals                                 used to                      Florida and      functions     inspectors,     online for   
    First, the     that is          developed Core               fulfill      Development       Delaware      through the   and training       courses    
 o    career       operated by     Curricula-Basic,             training       Associate   o    provided       Internet.    organizations    offered at   
    development    the Family &     Advanced, and             requirements     degree or        training       This has      by allowing      community   
    program for    Workplace        Specialty-that             and also to      college       information     saved time    providers to     colleges or  
       early       Connection,          can be                  pursue a        credit.           and             for         register          other     
     childhood     has                                            Child                      administrative   providers,                    organizations 
     offering    
    child care   
training. In  
     addition,   
providers and 
    inspectors   
       have      
                                                                                                                                                                          rewards                            
been able to                                                                   process                                                                    maximized    for        both North   encourage  
access           this program                              using an        transparent       seeking        facility                     Education of        and       training    Carolina    them to    
providers'      has saved the   been done to               Internet         and easily    quality child      because                         Young        retention    and           and       pursue     
transcripts        state time   quantify these             system has      accessible.     care can see     they are                       Children       rates for    higher      Oklahoma    training.  
online.19          and money,   savings. Other             promoted        In Florida,    the latest the   immediately   According to      (NAEYC),      child care    quality      offer      These      
State             although no   state officials            quality in              for      inspection      posted on     child care       training        workers     child      incentives   incentives 
officials say    studies have   have noted that            child care by      example,     reports on a        the       officials and   opportunities    increased    care are       to       are        
that                                                       making the         families                      Internet.    the National         are           when       linked.    providers    offered    
                                                                                                                             Association                                  For            to       through a
                                                                                                                               for the                                    example,                
    program for  
      college    
scholarships  
     funded by   
      state,     
federal, and  
      private    
                                                                              provide                                 R&R   early                                       
         dollars   have also                                                  information       written          provides   childhood        to look for                
     (T.E.A.C.H.   adopted a                                     Parent       on the           brochures,       parents a   providers,          when        checking on 
           Early   salary             increased                training is    Internet        fact sheets,       database   available       considering a    a child's  
Childhood).20   supplement         education                provided by    and by              and         listing all   options for     provider, and   placement,  
      Both North   program           attainment.                   R&R        telephone,      newsletters.        legally   care,              what to       that is,   
    Carolina and   called WAGE$                               organizations   as well as      For example,      operating   indicators of   consider when   determining 
        Oklahoma   to reward                         Parent      in each      through          Florida's       child care   quality                          how well   
                                                    Training  state, which                                            and                                       the     

19Transcripts are proof that education requirements have been met. 20The
T.E.A.C.H. program was operating in 22 states in 2003.

Concluding Observations

placement will meet a child's needs. In Delaware, the R&R offered
workshops throughout the year to parents on over 105 topics pertaining to
children up to school age. In all four states we visited, the R&R agency
provided a system to help parents locate child care-often known as a child
care locator-as well as information about how to choose quality care and
what training opportunities were available for parents. One expert we
interviewed told us that it is important to educate parents because they
are the ones who visit the child care facility every day and are most
effective in helping to ensure provider compliance with state child care
standards.

By expanding who is covered by licensing requirements and parental
knowledge, states have increased oversight on child care providers since
1999. However, some states have decreased the number of inspections per
facility per year. At the same time, states are maintaining their
flexibility in administering CCDF and providing parents with choice in the
child care options available to them. States use inspections to oversee
the child care provided in facilities with the greatest number of children
and use less intensive methods like self-certification for other
facilities they regulate. Self-certification affords less assurance that
providers are meeting safety and health requirements, but in an era when
caseload sizes already exceed recommended levels in many states and states
find themselves challenged by increasing child care demand, it helps keep
low-cost child care available.

The use of technology has also increased in the states for state licensing
staff, providers, and parents. Not only have the number of states using
technology in the areas associated with state activities in new areas,
providing information and training resources for parents licensing and
enforcement increased, but technology has also expanded into new areas,
providing information and training resources for parents, providers, and
training organizations on a broad range of topics for a number of
different functions. The obvious advantages of an up-to-date,
Internet-based, integrated information system have been demonstrated by
Florida. However, the size of the investment required for this type of
system depends on whether or not the state chooses to create an
independent licensing information system, or if the state wants its
licensing system to be part of a larger statewide child care information
system. Florida found it more affordable to do the former.

Agency Comments 	We provided officials of the Administration for Children
and Families (ACF), HHS, an opportunity to comment on a draft of this
report. ACF was pleased with the findings and noted that the report will
be especially helpful to ACF and the states because it compares state
child care health and safety enforcement in 1999 and 2003. ACF's comments
are reproduced in appendix VI. ACF also supplied technical comments that
were incorporated as appropriate.

Unless you publicly announce its contents earlier, we plan no further
distribution until 30 days after the date of this letter. At that time we
will send copies of this report to the Honorable Wade F. Horn, Assistant
Secretary, Administration for Children and Families, HHS; appropriate
congressional committees; and other interested parties. In addition, the
report will be available at no charge on GAO's Web site at
http//:www.gao.gov. If you or your staff have any questions or wish to
discuss this material further, please call me on (202) 512-7215.

Sincerely yours,

Marnie S. Shaul, Director Education, Workforce, and

Income Security Issues

                       Appendix I: Scope and Methodology

To perform our work, we conducted a mail survey in 2004 of state licensing
officials in all 50 states and the District of Columbia about their
licensing and enforcement policies and practices in 2003. Specifically, we
asked states to report on the frequency of their compliance inspections,
background checks, training programs and educational requirements for
licensing staff, and caseload sizes. We achieved a response rate of 98
percent, with 49 states and the District of Columbia responding to our
survey. Maine did not respond. In our 1999 survey, we achieved a 100
percent response rate.

We compared our survey results with a mail survey we conducted in 1999 to
identify any changes that had occurred within the past few years. Of the
30 substantive questions on our 2004 survey, 17 were identical to those in
the 1999 survey, 1 was a version of another 1999 question, and 12 were new
questions. To ensure their reliability, we pretested all new questions
with current or former state licensing officials.

Rather than using our survey data for the number of states exempting
family child care providers' regulation, we used data from the National
Child Care Information Center (NCCIC). The responses to question 16 of our
survey (on the number of states exempting some family child care homes
from state regulation) proved problematic, as it had in the 1999 survey.
Callbacks to a sample of respondents whose survey responses differed from
data produced by NCCIC showed that respondents misunderstood our question.
The NCCIC information was based on published state standards of the
regulation threshold point for the number of children served rather than
survey data. Therefore we used the NCCIC data in this report to answer
this question. Since this was similar to what we had done to compensate
for the problems in responses to that question in the 1999 survey, the
data for the 2 years are comparable.

In addition, we conducted a literature search and interviewed child care
licensing experts and state and federal officials to gather information
about critical licensing and enforcement activities occurring within the
states. The experts we interviewed included university research
professors, representatives from public policy organizations, staff from
organizations that deal with the policy and practice of providing child
care services.

With the information we gathered through these expert interviews, we
identified and conducted site visits in four states-Delaware, Florida,
North Carolina, and Oklahoma-to provide examples of promising practices in
licensing and enforcement. We conducted our work between

Appendix I: Scope and Methodology

October 2003 and July 2004 in accordance with generally accepted
government auditing standards.

Appendix II: State Caseloads, Fiscal Years 2003 and 1999

                     Number of full-time     Caseload        Caseload         
                                                      (facilities/ Percentage 
              equivalent staff for child (facilities/                  change 
         Number of child care care        inspector)  inspector) in caseload, 
         licensing and                                                   1999 
             facilities 2003 enforcement                                      
State                            2003         1999            2003 to 2003

            Alabama              3,356         a       276       a          a 
             Alaska              1,924        32        b        60         a 
            Arizona              2,857        40        90       71    
            Arkansas             2,680         5        91      536    
           California            59,179       246      249      241    
            Colorado             7,179        52       333      138    
          Connecticut            4,937        32       171      154    
            Delaware             2,024        15       160      135    
      District of Columbia        595          9        85       66    
            Florida              9,844        85       118      116    
            Georgia               8561        54       229      159    
             Hawaii               1006        29        a        35         a 

        Idaho             a            a           a          a             a 
       Illinois         13,550                    75          a             a 
       Indiana          4,637          45         116        103     
         Iowa           7,196          12          c         600            a 
        Kansas          8,612          31         166        278     

Kentucky 2,224 38 97 59 -40

a a

Louisiana 6,969 25 279

Maine 327                                                            
Maryland 12,844 152 113 85 -25                                       
Massachusetts 12,766 59 204 216 6                                    
Michigan 18,749 61 228 307 35                                        
                                                                 a a    

b .b b b

Minnesota 1,614 0 142

Mississippi 25 109                                                  
Missouri 4,389 77 52 57 10                                          
Montana 1,884 12 152 157 3                                          
Nebraska 4,038 28 153 144 -6                                        
                                         a a a                         

a a a

N

Nevada 7 63                                                          
New Hampshire 1,212 9 74 135 82                                      
New Jersey 9,101 31 129 294 128                                      
                                                          a a           

ew Mexico 1,006 11 91
New York 16,298 406 104 40 -61
North Carolina 9,066 116 135 78 -42

Appendix II: State Caseloads, Fiscal Years 2003 and 1999

                           Number of full-time     Caseload     Caseload      
                                                                 (facilities/ 
                    equivalent staff for child (facilities/ Percentage change 
                  Number of child care care     inspector)      inspector) in 
                  licensing and                                caseload, 1999 
       State       facilities 2003 enforcement         1999      2003 to 2003 
                                          2003              
    North Dakota                      1,623 19          104        85         
        Ohio                         21,244 59          149        360        
      Oklahoma                       6,521 130           56        50         
       Oregon                         6,055 40          75d        151        
    Pennsylvania                      9,081 71          157        128        
    Rhode Island                       1,786 9          168        198        
South Carolina                     3,583 52          250        69         
    South Dakota                      1,150 12          175        96         
     Tennessee                        4938 168           71        29         
       Texas                        20,293 281           66        72         
        Utah                          2,012 26           70        77         
      Vermont                          1,905 8          271        238        
      Virginia                        6,590 75          104        88         
     Washington                       9,012 88          118        102        
West Virginia                      4,014 44          57e        91         
     Wisconsin                        5,588 60           82        93         
      Wyoming                           717 17          149        42         

Source: GAO surveys, 1999 and 2004.
aData were not available.
bState that did not respond to this survey.
cIowa only provided caseload data for centers.
dOregon provided an estimate of its caseload for group homes and centers
only.
eWest Virginia could provide data only on the number of its child care
centers.

Appendix III: State Child Care Licensing Budget and Full-Time-Equivalent
Staffing Levels, 1999 and 2003

Most state licensing offices reported increases in budgets and the number
of full-time equivalent (FTE) staff since1999, although an increase in one
did not necessarily reflect an increase in the other.

Licensing budget FTEs

                    Page 30 GAO-04-786 Child Care Licensing
                                                                 1999           1999                                                                                                                                                                                                                                                                                                       District                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
Percentage   Percentage    change,   change, State 1999 2003a  to  1999 2003   to Alabama b b b 16 b b Alaska b b b b 32 b Arizona b $2,115,961 b 25 40 +60 Arkansas $2,170,972 2,928.492 +35 35 5  California 77,405,725 232,195,000 +200 197 246 +25 Colorado 2,900,000 5,545,095 +91 25 52 +108 Connecticut 1,750,000 2,652,000 +52 36 32  Delaware 1,689,841 2,094,500 +24 14 15 +7    of    1,186,000 1,187,000 0 7 9 +29 Florida 5,719,145 15,634,362 +173 75 85 +13 Georgia 4,017,676 5,752,602  49 54 +10 Hawaii 9,556,728 632,304 -93 0 29  Idaho b b b b b b Illinois b 16,907,943 b 171 b b Indiana 2,152,464 2,832,145 +32 34 45 +32 Iowa b b b b 12 b Kansas 2,596,754 3,670,352 +41 55 31 -44 Kentucky 8,888,500 2,499,300 b 21 38 +81 Louisiana 1,800,000 222,961 -88 b 25 b Maine 600,000 d d 11 d d Maryland 8,438,215 11,599,924 +37 126 152 +21 Massachusetts 7,000,000 7,018,242 0 69 59 -14 Michigan 8,000,000 18,546,700 +132 93 61 -34 Minnesota 3,320,013 b b 114 b b Mississippi 750,000 1,701,701 +127 15 25 +67 Missouri 5,000,000 5,399,384 +8 86 77 -10 Montana b 652,142 b 12 12 0          b           b       
                                                                 2003           2003                                                                                                                                                                                                                                                                                                       Columbia                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 Nebraska   1,722,772   28 28 0

Appendix III: State Child Care Licensing Budget and Full-Time-Equivalent
Staffing Levels, 1999 and 2003

Licensing budget FTEs

                                           Percentage              Percentage 
                                            change,                   change, 
        State             1999      2003a 1999 to 2003 1999 2003 1999 to 2003 
       Nevada                b 1,581,258             b  17     7 
    New Hampshire      692,576  851,746            +23  16     9 
     New Jersey      3,452,400 2,717,369           -21  28    31          +11 
     New Mexico        674,200  565,000            -16  15    11 
      New York      13,498,700 28,000,000     +107     234   406          +74 
North Carolina    5,670,000 11,732,850     +107      67   116          +73 
    North Dakota       453,400  954,050       +110      18    19           +6 
        Ohio         3,999,575 5,351,784     +1239      66    59 
      Oklahoma       5,680,905 7,100,000           +25 111   130          +17 
       Oregon        2,732,259 5,532,146      +102      34    40          +18 
    Pennsylvania     4,500,000 5,750,000           +28  55    71          +29 
    Rhode Island             b  825,760              b    7    9          +29 
South Carolina    1,612,433 3,148,902           +95  15    52         +247 
    South Dakota       608,110  694,690            +14  10    12          +20 
      Tennessee      1,922,700 7,300,000      +280      81   168         +107 
        Texas       14,100,000 23,989,393          +70 329   281 

West V

Utah 2,576,798 3,004,179 +17 31 26 -16                                  
Vermont 629,972 658,514 +5 7 8 +14                                      
Virginia 6,919,074 12,061,452 +74 57 75 +32                             
Washington 5,411,000 9,615,023 +78 79 88 +11                            
                                                      b b b                

irginia 7 44 +529 Wisconsin 3,480,800 6,266,910 +80 60 60 0 Wyoming
444,279 1,135,621 +156 6 17 +183 Source: GAO surveys, 1999 and 2004 aThe
latest year for which budget data were available was 2003.
bSome states could not provide us with FTE or budget information for
particular years.
cCannot express as a percentage change because 1999 was zero.
dMaine did not respond to the survey.

Appendix IV: Frequency of Licensure and Monitoring Visits in the States

Number of years for which a Does the state conduct renewal Frequency of
routine compliance State license is issued visits? visits

Alabama

a

Family day care 2 Yes Once a year

b

Group homes 2 Yes Once a year

                       Centersc 2 Yes Once every 2 years

Alaska

                       Family day care 2 Yes Once a year

                         Group homes 2 Yes Once a year

                           Centers 2 Yes Once a year

Arizona

                       Family day care 3 Yes Once a year

                         Group homes 3 Yes Once a year

                           Centers 3 Yes Once a year

Arkansas

             Family day care Nonexpiring N/A At least twice a year

Group homes N/A N/A N/A

                 Centers Nonexpiring N/A At least twice a year

California

    Family day care   Nonexpiring   N/A      Not inspected on a regular basis 
      Group homes     Nonexpiring   N/A      Not inspected on a regular basis 
        Centers       Nonexpiring   N/A      Not inspected on a regular basis 
       Colorado                          
    Family day care   Nonexpiring   Yes                    Once every 2 years 
      Group homes     Nonexpiring   Yes                    Once every 2 years 
        Centers       Nonexpiring   Yes                    Once every 2 years 
      Connecticut                        
    Family day care        2        No     Less often than once every 2 years 
      Group homes          2        No                     Once every 2 years 
        Centers            2        No                     Once every 2 years 
       Delaware                          
    Family day care        1        No               Once a year              
      Group homes          1        Yes              Once a year              
        Centers            1        Yes              Once a year              

Appendix IV: Frequency of Licensure and Monitoring Visits in the States

Number of years for which a Does the state conduct renewal Frequency of
routine compliance State license is issued visits? visits

District of Columbia

                       Family day care 1 Yes Once a year

Group homes N/A N/A N/A

                           Centers 1 Yes Once a year

Florida

                  Family day care 1 Yes At least twice a year

Group homes N/A N/A N/A

                      Centers 1 Yes At least twice a year

Georgia

Family day care Nonexpiring No N/A

                 Group homes Nonexpiring Yes Once every 2 years

                   Centers Nonexpiring Yes Once every 2 years

Hawaii

                  Family day care 1 Yes At least twice a year

                    Group homes 1 Yes At least twice a year

                      Centers 1 Yes At least twice a year

Idaho

                    Page 33 GAO-04-786 Child Care Licensing
                                                                                                                                                                                                                   Less             Less                                                                                                            
              Once              Once                Once                                                                                                                                                          often            often                                                Not                                                         
Family       every Group       every               every             Family       Once Group         Once               Once            Family       Once Group       Once               Once         Family       then Group       than               Once           Family      inspected Group                 Once                              
 day   2 Yes     2 homes 2 Yes     2 Centers 2 Yes     2 Illinois     day   3 N/A  a   homes N/A N/A  a   Centers 3 N/A  a   Indiana     day   2 Yes  a   homes 2 Yes  a   Centers 2 Yes  a   Iowa     day   2 No  once homes 2 No  once Centers 2 Yes  a   Kansas     day   1 No      on a homes Nonexpiring Yes  a   Centers             Yes 
 care        years             years               years              care        year               year               year             care        year             year               year          care       every            every               year            care         regular                       year                         Once
                                                                                                                                                                                                                      2                2                                              basis                                                     a
                                                                                                                                                                                                                  years            years                                                                                       Nonexpiring     year

Appendix IV: Frequency of Licensure and Monitoring Visits in the States

Number of years for which a Does the state conduct renewal Frequency of
routine compliance State license is issued visits? visits

Kentucky

                       Family day care 1 Yes Once a year

                         Group homes 1 Yes Once a year

                           Centers 1 Yes Once a year

Louisiana

                       Family day care 1 Yes Once a year

                         Group homes 1 Yes Once a year

                           Centers 1 Yes Once a year

Maine

d d d

Family day care

d d d

Group homes

d d d

Centers

Maryland

Family day care 2 Yes Once every 2 years

Group homes N/A N/A N/A

                Centers 1 Yes Less often than once every 2 years

Massachusetts

                    Page 34 GAO-04-786 Child Care Licensing
                                                                               Less                                                                                                                                                                                                                                                             
                                                                              often                                                                     Not                   Not                Once                                                                                                                                           
Family       Once Group       Once               Once             Family       than Group       Once               Once              Family       inspected Group       inspected               every                Family       Once Group       Once               Once             Family       Twice Group       Twice                     
 day   3 Yes  a   homes 3 Yes  a   Centers 2 Yes  a   Michigan     day   3 No  once homes 2 Yes  a   Centers 2 Yes  a   Minnesota     day   2 Yes      on a homes 2 Yes      on a Centers 1 Yes     2 Mississippi     day   1 Yes  a   homes 1 Yes  a   Centers 1 Yes  a   Missouri     day   2 Yes   a   homes 2 Yes   a   Centers 2 Yes 
 care        year             year               year              care       every             year               year               care          regular               regular               years                 care        year             year               year              care        year              year                Twice
                                                                                  2                                                                   basis                 basis                                                                                                                                                           a
                                                                              years                                                                                                                                                                                                                                                       year

Appendix IV: Frequency of Licensure and Monitoring Visits in the States

Number of years for which a Does the state conduct renewal Frequency of
routine compliance State license is issued visits? visits

Montana

       Family day care Varies with past performance No Once every 2 years

         Group homes Varies with past performance No Once every 2 years

Centers Varies with past performance Yes Once a year

Nebraska

                   Family day care Nonexpiring No Once a year

                    Group homes Nonexpiring Yes Once a year

                      Centers Nonexpiring Yes Once a year

Nevada

                  Family day care 1 Yes At least twice a year

                    Group homes 1 Yes At least twice a year

                      Centers 1 Yes At least twice a year

New Hampshire

                       Family day care 3 Yes Once a year

                         Group homes 3 Yes Once a year

                           Centers 3 Yes Once a year

New Jersey

                    Page 35 GAO-04-786 Child Care Licensing
Family        Once                                 Once           Family       Once             Once               Once         Family             Once              Once                Once             Family                 Once                       Once                         Once           Family       Once             Once                    
 day   3 Yes every Group N/A N/A N/A Centers 3 Yes    a  New       day   1 Yes    a Group 1 Yes    a Centers 1 Yes    a New      day   2    no    every Group 2 Yes every Centers 2 Yes every  North       day   Nonexpiring N/A    a Group Nonexpiring N/A    a Centers Nonexpiring N/A    a North      day   1 Yes    a Group 1 Yes    a Centers 1 Yes Once 
 care            2 homes                           year Mexico     care        year homes       year               year York     care    response     2 homes           2                   2 Carolina     care                  year homes                 year                         year Dakota     care        year homes       year                  a 
             years                                                                                                                                years             years               years                                                                                                                                                            year

Appendix IV: Frequency of Licensure and Monitoring Visits in the States

Number of years for which a Does the state conduct renewal Frequency of
routine compliance State license is issued visits? visits

Ohio

Family day care N/A N/A N/A

Group homes N/A N/A N/A

                      Centers 2 Yes At least twice a year

Oklahoma

             Family day care Nonexpiring N/A At least twice a year

               Group homes Nonexpiring N/A At least twice a year

                 Centers Nonexpiring N/A At least twice a year

Oregon

                    Family day care 2 N/A Once every 2 years

                    Group homes 1 N/A At least twice a year

                      Centers 1 N/A At least twice a year

Pennsylvania

             Family day care 2 No Not inspected on a regular basis

Group homes 1 Yes Once a year

Centers 1 Yes Once a year

Rhode Island

                    Page 36 GAO-04-786 Child Care Licensing
                                                                                                                                                                                                                                                                                                                             Less                                                         
              Once                                  At                               Not                At                  At                           Once                                                                                      At                At                  At                                 often                                                         
Family       every Group       Once              least  South      Family      inspected Group       least               least South     Family         every Group                 Once                         Once              Family       least Group       least               least          Family                  than Group                 Once                              
 day   2 Yes     2 homes 1 Yes  a   Centers 1 No twice Carolina     day   1 No      on a homes 2 Yes twice Centers 2 Yes twice Dakota     day   N/A Yes     2 homes Nonexpiring Yes  a   Centers Nonexpiring Yes  a   Tennessee     day   1 Yes twice homes 1 Yes twice Centers 1 Yes twice Texas     day   Nonexpiring N/A  once homes Nonexpiring N/A  a   Centers                 
 care        years             year                  a              care         regular                 a                   a            care          years                       year                         year               care            a                 a                   a           care                  every                       year                         Once
                                                  year                             basis              year                year                                                                                                                   year              year                year                                     2                                                     a
                                                                                                                                                                                                                                                                                                                            years                                    Nonexpiring N/A year

Appendix IV: Frequency of Licensure and Monitoring Visits in the States

Number of years for which a Does the state conduct renewal Frequency of
routine compliance State license is issued visits? visits

Utah

                       Family day care 2 Yes Once a year

                         Group homes 2 Yes Once a year

                           Centers 2 Yes Once a year

Vermont

             Family day care 1 No Not inspected on a regular basis

Group homes 1 Yes At least twice a year

Centers 1 Yes At least twice a year

Virginia

             Family day care Nonexpiring Yes At least twice a year

Group homes N/A N/A N/A

                 Centers Nonexpiring Yes At least twice a year

Washington

            Family day care 3 Yes Less often than once every 2 years

Group homes N/A N/A N/A

Centers 3 Yes Once a year

West Virginia

      Family day care           2           Yes                   Once a year 
        Group homes             2           Yes                   Once a year 
          Centers               2           Yes                   Once a year 
         Wisconsin                                 
      Family day care      Nonexpiring      Yes                   Once a year 
        Group homes            N/A          N/A                           N/A 
          Centers          Nonexpiring      Yes         At least twice a year 
          Wyoming                                  
      Family day care           1           N/A         At least twice a year 
        Group homes             1           N/A         At least twice a year 
          Centers               1           N/A         At least twice a year 

Source: GAO survey, 2004

N/A: not applicable

aFamily day care is provided by an individual provider in a private
residence other than the child's home.

bGroup homes provide care by two or more providers in a private residence
other than the child's home.

cCenters are nonresidential facilities that provide care for children and
include full-and part-time group programs, such as nursery and preschool
programs.

dMaine did not respond to our survey.

                    Page 38 GAO-04-786 Child Care Licensing

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Appendix VI: Comments from the Department of Health and Human Services

Appendix VI: Comments from the Department of Health and Human Services

Appendix VI: Comments from the Department of Health and Human Services

Appendix VII: GAO Contact and Staff Acknowledgments

       GAO Contact Eleanor Johnson, Assistant Director, (202) 512-7209 or
                                [email protected]

Staff 	In addition to the person named above, Margaret Armen, Amy Buck,
Patricia Bundy, Kara Kramer, Jerry Sandau, and Jay Smale also made

  Acknowledgments major contributions to this report.

Related GAO Products

Child Care: Recent State Policy Changes Affecting the Availability of
Assistance for Low-Income Families. GAO-03-588, May 5, 2003.

Child Care: States Exercise Flexibility in Setting Reimbursement Rates and
Providing Access for Low-Income Children. GAO-02-894, September 18, 2002.

Child Care: States Have Undertaken a Variety of Quality Improvement
Initiatives, but More Evaluations of Effectiveness Are Needed.

GAO-02-897, September 6, 2002.

Child Care: States Increased Spending on Low-Income Families.

GAO-01-293, February 2, 2001.

Child Care: State Requirements for Background Checks.

GAO/HEHS-00-66R, February 28, 2000.

Child Care: State Efforts to Enforce Safety and Health Requirements.

GAO/HEHS-00-28, January 24, 2000.

Child Care: How Do Military and Civilian Center Costs Compare?

GAO/HEHS-00-7, October 14, 1999.

Welfare Reform: States' Efforts to Expand Child Care Programs.
GAO/HEHS-98-27, January 13, 1998.

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