AN ACT relating to child care and declaring an emergency.

Create a new section of KRS Chapter 199 related to the quality-based graduated early care and education rating system program to establish the intent of the General Assembly related to the program; establish processes and procedures for how the program is changed by administrative regulation; require a program modernization plan and final recommendations for modernization to be created and submitted to the Legislative Research Commission; amend KRS 199.891 to define terms; create new requirements for how the Cabinet for Health and Family Services establishes and operates the Certified Child Care Community Designation Program; delete language related to a previous 1 time requirement for the cabinet to submit recommendations and best practices to the Legislative Research Commission; establish a new January 1, 2028 submission deadline for the cabinet to make publicly available a standardized application for certification and instructions for the program; establish new requirements for applications by local governments to participate in the program; require an annual report by the Cabinet for Economic Development regarding the program; amend KRS 199.8983 to increase the membership of the Kentucky Child Care Advisory Council; establish that the council shall additionally advise the Cabinet for Health and Family Services on the operations, funding, and licensing of child-care microcenters; create new sections of KRS Chapter 199 to define terms; establish licensure for child-care microcenters; establish the Kentucky Child-Care Microcenter Program to regulate the standards and operations of child-care microcenters; establish early care and education training requirements for licensed child-care providers and certified family child-care home providers; establish that the Education and Labor Cabinet shall compile, produce, and make publicly available a monthly report providing a comprehensive snapshot of all licensed and certified child care services, Head Start services, child care services regulated by the United States Department of Defense, and state-funded public preschool services operating within the Commonwealth; establish a voluntary designation process through which any licensed or certified child-care provider may identify as a faith-based program; require the Office of State Budget Director to produce a comprehensive annual report outlining all state and federal spending on child care and early childhood education services and submit it annually to the Legislative Research Commission; establish that the Cabinet for Health and Family Services shall submit an approval request to the federal Administration for Children and Families to utilize a cost estimation model to inform payment rates beginning with the fiscal year 2028-2030 Child Care and Development Fund state plan; amend KRS 199.882 to change the definitions of "contribution" and "state match" and define "third-party administrator"; amend KRS 199.883 to establish that the Cabinet for Health and Family Services shall enter into a contract with a private third-party administrator to administer the Employee Child Care Assistance Partnership Program and establish duties and requirements of the third-party administrator; amend KRS 199.885 to establish the third-party administrator is responsible for issuing state fund matches out of the Employee Child Care Assistance Partnership fund; amend KRS 199.886 and 199.887 to specify how employers and employees interact directly with the third-party administrator instead of the Cabinet for Health and Family Services.