1. (a) “Actual and allowable net costs” means the costs which may be reimbursed under a preschool contract after disallowed costs and restricted income have been subtracted from total expenditures.
2. (b) “Additional funds” means award of new contracts or expanded contracts that increase the contractor's level of administrative responsibility. Additional funds do not include cost of living adjustments, rate increases, or one-time-only supplemental funds.
3. (c) “Adjusted child days of enrollment” means child days of enrollment after adjustment factors specified in Education Code section 8245 have been applied.

4. (d) “Adjusted monthly income” means the total countable income as defined below, minus verified child support payments paid by the parent whose child is receiving preschool services, excluding the non-countable income listed below:

   1. (1) Earnings of a child under age 18 years;
   2. (2) Loans;
   3. (3) Grants or scholarships to students for educational purposes;
   4. (4) Federal Supplemental Assistance Program (CalFRESH/SNAP) or Women, Infants and Children (WIC) benefits or other food assistance;
   5. (5) Earned Income Tax Credit or tax refund;
   6. (6) GI Bill entitlements, hardship duty pay, hazardous duty pay, hostile fire pay, or imminent danger pay;
   7. (7) Adoption assistance payments received pursuant to Welfare and Institutions Code section 16115 et seq;
   8. (8) Non-cash assistance or gifts;
   9. (9) All income of any individual counted in the family size who is collecting federal Supplemental Security Income (SSI) or State Supplemental Program (SSP) benefits;
   10. (10) Insurance or court settlements including pain and suffering and excluding lost wages and punitive damages;
   11. (11) Reimbursements for work-required expenses such as uniforms, mileage, or per diem expenses for food and lodging;
   12. (12) Business expenses for self-employed family members;
   13. (13) When there is no cash value to the employee, the portion of medical and/or dental insurance documented as paid by the employer and included in gross pay;
   14. (14) Disaster relief grants or payments, except any portion for rental assistance or unemployment; and
   15. (15) AmeriCorps Volunteers In Service to America (VISTA) and Federal Emergency Management Agency (FEMA) stipends, room and board, and grants.
   16. (16) Foster payments made on behalf of a child pursuant to section 11460, 11461.3, 11461.36, or 11461.4 of the Welfare and Institutions Code including clothing allowance for children placed through child welfare services; and
   17. (17) Guaranteed income payments as set forth in section 17700(an).
5. (e) “Administrative costs” means costs incurred for administrative activities where neither the family, the child, nor the service providers operating family child care homes directly benefit from the activity.
6. (f) “Adult” for the purposes of this chapter means a person who is at least 18 years of age.

7. (g) “Applicants headquartered in” means:

   1. (1) Contractors or applicants that have provided preschool services in the service delivery area, as defined in subsection (bo), for at least three years immediately preceding the posting date of the request for applications; or
   2. (2) Contractors or applicants that have their primary administrative offices for the preschool program in the service delivery area as defined in subsection (bo). The primary administrative office is that office which houses the executive officer(s), the fiscal functions, and other centralized support services as documented to the Internal Revenue Service and/or the California School Directory website located at http://www.cde.ca.gov.
8. (h) “Authorized representative” means a person who has been given authority to perform a task for a parent or a contractor.
9. (i) “Benefit to the state” means that the activity will improve knowledge or expertise in areas directly related to subsidized preschool services.
10. (j) “California State Preschool Program (CSPP)” means the definition of “California state preschool program” as defined in Education Code section 8205. This is also referred to sometimes as “preschool program.”
11. (k) “California State Preschool Program eligible four-year-old children” are children that meet the definition of “four-year-old children” in Education Code section 8205.
12. (l) “California State Preschool Program eligible three-year-old children” are children that meet the definition of “three-year-old children” in Education Code section 8205.
13. (m) “California State Preschool Program (CSPP) Classroom” means a teaching team and a group of children where at least one child in the group is receiving services from the California State Preschool Program. Part-day programs that have one teaching team that serves two different groups of children would be considered two separate CSPP classrooms.
14. (n) “Ceases operation” means the contractor does not provide subsidized services in accordance with the contractor's program operating calendar submitted to and approved by the California Department of Education (CDE) Early Education Division for the applicable contract period.
15. (o) “Certified schedule” means the number of hours per day and/or week that a family is approved to receive subsidized preschool services. This is also referred to sometimes as a “child care schedule.”

16. (p) “Certified observer,” means someone who has completed the Classroom Assessment Scoring System® (CLASS®), Second Edition Pre-K-3rd training to become a CLASS® observer, passed the CLASS® certification test for second edition pre-K or second edition pre-K-3rd, and has an active CLASS® certification from Teachstone. They must also complete the following:

    1. (1) The CLASS® Observer Support Series training; and
    2. (2) The CLASS® Environment training.

17. (q) “Certification Period” means the period of time in which the family or child is certified as eligible for CSPP services.

    1. (1) For part-day CSPP, a family is eligible for the remainder of the current program year and the following program year, provided the child continues to meet age eligibility requirements.
    2. (2) For full-day CSPP, a family is eligible for at least 24 months as long as applicable age-eligibility requirements are met. If the eligibility period ends before the end of a program year, contractors shall extend eligibility until June 30 of that program year, or longer as required by section 17749.
18. (r) “Child protective services” means children receiving protective services through the local county welfare department as well as children identified by a legal, medical, social service agency or emergency shelter as abused, neglected or exploited or at risk of abuse, neglect or exploitation.
19. (s) “Child with disabilities” means the definition of “children with exceptional needs” as defined in Education Code section 8205.
20. (t) “CLASS® Environment Observation” means an observation conducted by a certified observer using the Pre-K-K Classroom Assessment Scoring System® (CLASS®) Environment Manual (2022), hereby incorporated by reference, which is the observation tool developed by Teachstone and used alongside CLASS® to describe and measure specific features of learning settings that can support effective interactions and enhance children's development and learning.
21. (u) “CLASS® Observation” means cycles conducted by a certified observer using the Classroom Assessment Scoring System® (CLASS®) Observation Field Guide, Second Edition (2023) Pre-K-3rd, hereby incorporated by reference, which is the observation tool developed by Teachstone, to measure the quality of educator-child interactions.
22. (v) “Commingled services” means the provision of services to both CSPP and non-CSPP children in the same classroom at the same time.
23. (w) “Contract period” means the time span the contract is in effect as specified in the preschool contract.
24. (x) “CSPP Neighborhood School Site” means a CSPP site that has been verified as operating within the attendance boundaries of a qualified free and reduced price meal (FRPM) school.
25. (y) “Cycle” means a 20-minute observation period and a 10-minute scoring period conducted as part of a CLASS® Observation.
26. (z) “Declaration” means a written statement signed by a parent under penalty of perjury attesting that the contents of the statement are true and correct to the best of that parent's knowledge.
27. (aa) “Depreciation” means a cost in the current fiscal year that is based on acquisition costs, less any estimated residual value, computed on a straight-line method based on the normal, estimated useful life expectancy of the asset.

28. (ab) “Desired Results Developmental Profiles” (DRDP) are documents on the Desired Results website (https://www.desiredresults.us/drdp-forms) used to record the information in the developmental profile defined in subsection (ad). Contractors must use one of the following developmental profiles, hereby incorporated by reference, that is age-appropriate for the child:

    1. (1) DRDP (2015) Preschool Comprehensive View (rev. 6/24/2019).
    2. (2) DRDP (2015) Preschool Fundamental View (rev. 6/24/2019).
    3. (3) DRDP (2015) Preschool Essential View (rev. 6/24/2019).
    4. (4) DRDP-K (2015) Comprehensive View (rev. 2015).
    5. (5) DRDP-K (2015) Fundamental View (rev. 2018).
    6. (6) DRDP-K (2015) Essential View (rev.2018).

29. (ac) “Desired Results System” means the program foundation, frameworks and assessment tools used to inform and facilitate high-quality programs, which include a developmental profile, program self-evaluation, and a parent survey that measure the following desired results for children and families:

    1. (1) Children are personally and socially competent.
    2. (2) Children are effective learners.
    3. (3) Children show physical and motor competence.
    4. (4) Children are safe and healthy.
    5. (5) Families support their child's learning and development.
    6. (6) Families achieve their goals.
30. (ad) “Developmental profile” means a record of a child's physical, cognitive, social, and emotional development that is used to inform teachers and parents about a child's developmental progress in reaching expected child outcomes. In center-based programs, teacher and parent observations shall be included as part of the information used to complete the child's developmental profile. In family child care home networks, the observations of agency staff, in consultation with provider and parents shall be included as part of the information used to complete the child's developmental profile.
31. (ae) “Disallowed costs” means costs which have been incurred but are not reimbursable because they are not reasonable and/or necessary for the performance of the contract or are non-reimbursable as specified in section 17806.
32. (af) “Displace families” means the disenrollment of families in order to reduce service levels due to insufficient funding or inability of a contractor to operate one or more sites because of reasons stated in Education Code section 8249.
33. (ag) “Early childhood programs” is defined as set forth in Education Code section 8205.
34. (ah) “Education program” means the environment, activities, and services provided to the children.
35. (ai) “Family” means the parents and the children for whom the parents are responsible who comprise the household in which the child receiving services is living. For purposes of income eligibility and family fee determination, when a child and that child's siblings are living in a family that does not include their biological or adoptive parent, “family” shall be considered the child and related siblings.
36. (aj) “Family engagement and strengthening” means those activities specifically designed to include parents in the education of their children, help parents participate in the program, and enhance their understanding of child development.
37. (ak) “Family experiencing homelessness” is defined as set forth in section 11434a(2) of title 42 of the United States Code, known as the McKinney-Vento Homeless Assistance Act.
38. (al) “Family Fee Schedule” means the fee schedule developed by the State Superintendent of Public Instruction (SSPI), in conjunction with the State Department of Social Services pursuant to Education Code section 8252.
39. (am) “Funded Enrollment” means the definition of “funded enrollment” as defined in Education Code section 8205.
40. (an) “Guaranteed income payments” is defined as set forth in Education Code section 8213.
41. (ao) “Income eligibility” for the purpose of determining income eligibility for preschool services is defined as set forth in Education Code section 8213(a) and (b) as applicable.

42. (ap) “Income fluctuation” means income that varies due to:

    1. (1) Migrant, agricultural, or seasonal work;
    2. (2) Inconsistent, and/or unstable employment, or self-employment resulting in an inconsistent pattern of income; or
    3. (3) Intermittent, occasional, sporadic, or infrequent earnings or income, including but not limited to bonuses, commissions, lottery winnings, inheritance, back child support payment, overtime or net proceeds from the sale of real property or stock.
43. (aq) “Indirect cost” means an incurred cost that benefits more than one program and cannot be readily assigned to the benefitting programs.
44. (ar) “Indirect cost allocation plan” means a written justification and rationale for assigning the relative share of indirect costs across more than one program or contract.
45. (as) “Initial certification” means the formal processes the contractor goes through to collect information and documentation to determine that the family and/or child meets the criteria for receipt of subsidized preschool services. The dated signature of the contractor's authorized representative on an application for services certifies that the criteria have been met, and begins the certification period.
46. (at) “Legally qualified professional” means a person licensed under applicable laws and regulations of the State of California to perform legal, medical, health or social services for the general public.
47. (au) “License exempt classroom” means a CSPP classroom that is exempt from licensure pursuant to Health and Safety Code (H&SC) Section 1596.792(o).
48. (av) “Magnet school” means an entire school with a focus on a special area of study, such as science, the performing arts, or career education, designed to attract pupils from across the school district who may choose to attend the magnet school instead of their local public school.
49. (aw) “Maximum reimbursable amount” means the total dollar amount of a contract. Reimbursement from the state shall not exceed the maximum reimbursable amount. The initial maximum reimbursable amount shall be the approved original version of the annual contract based on the Budget Act as signed by the Governor.
50. (ax) “MyTeachstone” means the online subscription-based service, operated by Teachstone, designed to help programs manage and use CLASS® Observation and CLASS® Environment Observation data to inform continuous improvement and deliver individualized CLASS® based professional development.
51. (ay) “Net reimbursable program costs” means the portion of the actual and allowable net costs which are incurred in the provision of preschool services for CSPP children.
52. (az) “New contract” means a contract awarded to applicants who do not currently contract with the CDE for preschool services.
53. (ba) “Parent” means a biological parent, adoptive parent, stepparent, foster parent, caretaker relative, legal guardian, domestic partner of the parent as defined in Family Code section 297, or any other adult living with a child who has responsibility for the care and welfare of the child.
54. (bb) “Parent survey” means a questionnaire completed by the parent to assess the child care program or services that the child and family receive. The parent survey asks for information about how the program helps parents support their child's learning and development and meets the family's needs.
55. (bc) “Parental incapacity” means the temporary or permanent inability of the child's parent(s) to provide care and supervision of the child(ren) for any part of the day due to a physical and/or mental health condition.
56. (bd) “Preschool services” means services provided through a California state preschool program.
57. (be) “Private contractor” means an entity other than a public agency which is tax exempt or non-tax exempt and under contract with CDE for the provision of preschool services.
58. (bf) “Program self-evaluation process” means those activities and procedures used by the contractor to evaluate its program quality and compliance with applicable laws, regulations, and contractual provisions.
59. (bg) “Public contractor” means a school district, community college district, county superintendent of schools, campus of the California State University or the University of California system, county, city or other public agency under contract with the CDE for the provision of preschool services.
60. (bh) “Qualified FRPM school” is a public elementary school, that is not a charter or magnet school, where at least 80 percent of the enrolled students are eligible for free and reduced price meals.
61. (bi) “Reasonable and necessary costs” means expenditures that, in nature and amount, do not exceed what an ordinarily prudent person would incur in the conduct of a competitive business.
62. (bj) “Recertification” means the formal processes the contractor goes through to collect information and documentation to determine that the family and/or child continues to meet the criteria for receipt of subsidized preschool services. The dated signature of the contractor's authorized representative on an application for services certifies that the criteria have been met, and begins the certification period.
63. (bk) “Recipients of services” means families and/or children enrolled in a preschool program subsidized by the CDE.

64. (bl) “Request for applications (RFA)” means an announcement issued by the CDE for an award of new funding for preschool services or expansion of existing level of services. The RFA includes, but is not limited to:

    1. (1) The application content requirements;
    2. (2) Procedures and timelines for submission of an application for funding; and
    3. (3) How the application will be scored.
65. (bm) “Restricted income” means income which the donor designates may only be expended for specific limited purposes that are reimbursable according to the contract.

66. (bn) “Self-certification of income” means a declaration signed by the parent under penalty of perjury, identifying:

    1. (1) To the extent known, the employer's name, address, start date of work, the rate and frequency of pay, the total amount of income received for the preceding month(s), the type of work performed, and the hours and days worked; or
    2. (2) That the parent does not have income from employment and any source of income used to support the family including non-wage income.
67. (bo) “Service delivery area” means the community, geographic area or political subsection in which the preschool services are to be provided as specified in the RFA.
68. (bp) “Staff professional development program” means those activities that address the needs, interests, and skills of program staff or service providers to improve program quality.
69. (bq) “Subcontract” means a written agreement between the contractor and any entity to perform a service on behalf of the contractor.
70. (br) “Teaching team” means the adults retained by the program to provide program supervision and/or instruction to the children in the CSPP classroom.
71. (bs) “Teachstone” means Teachstone, Inc, a Virginia Corporation, and affiliates, if any.

72. (bt) “Total countable income” means all income of the individuals counted in the family size that includes, but is not limited to, the following:

    1. (1) Gross wages or salary, commissions, overtime, tips, bonuses, gambling or lottery winnings;
    2. (2) Wages for migrant, agricultural, or seasonal work;
    3. (3) CalWORKs cash aid;
    4. (4) Gross income from self-employment less business expenses with the exception of wage draws;
    5. (5) Disability or unemployment compensation;
    6. (6) Workers compensation;
    7. (7) Spousal support, child support received from the former spouse or absent parent, or financial assistance for housing costs or car payments paid as part of or in addition to spousal or child support;
    8. (8) Survivor and retirement benefits;
    9. (9) Dividends, interest on bonds, income from estates or trusts, net rental income or royalties;
    10. (10) Rent for room within the family's residence;
    11. (11) Financial assistance received for the care of a child living with an adult who is not the child's biological or adoptive parent;
    12. (12) Veterans pensions;
    13. (13) Pensions or annuities;
    14. (14) Inheritance;
    15. (15) Allowances for housing or automobiles provided as part of compensation;
    16. (16) Insurance or court settlements for lost wages or punitive damages;
    17. (17) Net proceeds from the sale of real property, stocks, or inherited property; or
    18. (18) Other enterprise for gain.
73. (bu) “Total expenditures” means all costs for the provision of subsidized services under the contract and any nonsubsidized services which are provided in classrooms with commingled preschool services.
74. (bv) “Unnecessarily increase the value” means an improvement of a site beyond what is required to meet California Code of Regulations, title 22, Community Care Licensing Standards.
75. (bw) “Unrestricted income” means income that has no restrictions regarding use by the donor, and income restricted by the donor for purposes that are not reimbursable according to the contract, including income for services to children not subsidized by the contract.
76. (bx) “Use allowance” means an alternate method for claiming the use of the contractor's assets as a cost when depreciation methods are not used.
77. (by) “Vocational training” means an educational or job training/apprenticeship/internship program, courses and/or classes leading to a recognized trade, paraprofession or profession.

Unless otherwise specified, the following definitions apply throughout this chapter:

Note: Authority cited: Sections 8207, 8231 and 8247, Education Code. Reference: Sections 8202, 8203, 8205, 8207, 8208, 8213, 8231, 8244, 8245, 8249, 8252, 8314 and 8332, Education Code; and Section 106 of Senate Bill (SB) 114 (Chapter 48, Statutes of 2023).

History

1. New chapter 18.5 (subchapters 1-11, sections 17700-17833), subchapter 1 (section 17700) and section filed 7-1-2022; operative 7-1-2022 pursuant to Government Code section 11343.4(b)(3) (Register 2022, No. 26).

2. New subsections (d)(16)-(17), (o)-(o)(2), (a)(i) and (a)(j), subsection relettering, amendment of newly designated subsections (q), (t), (w), (ao), (bb) and (bd), repealer of subsection (bl) and subsection renumbering filed 1-6-2025; operative 1-6-2025 pursuant to Government Code section 11343.4(b)(3) (Register 2025, No. 2).

3. Amendment filed 1-30-2026; operative 4-1-2026 (Register 2026, No. 5).