Kentucky allows small child-care centers with provider qualifications and caps

Kentucky’s Cabinet for Health and Family Services must set licensing rules for small child-care centers called microcenters. Microcenters serve four to 24 children outside a home for more than three hours daily. Kentucky may authorize no more than ten statewide and two per county. Microcenter applicants need at least three years of state licensing or certification, good standing, and participation in Kentucky’s quality-rating system. Microcenters need not offer meals, transportation, or playgrounds, but must plan physical activity. They may mix age groups, with capacity based on the youngest child served. The cabinet may approve exceptions to microcenter rules only if children’s health and safety remain protected. Providers may request an exception once per calendar year and use only one at a time. Denials cannot be challenged. Priority goes to designated low-income areas, counties with fewer than 50,000 residents, care for parents working unusual hours, and community partnerships. Microcenter rules are due by July 1, 2027. Applications cannot be accepted or approved before that date, and decisions are due within 90 days. The military pilot runs July 1, 2026, through June 30, 2028.

Providers must complete training about children with special needs and admit certain visiting specialists. State officials must follow support and enforcement rules for licensed centers. Training and specialist-access duties cover licensed child-care programs and certified family homes. Center enforcement rules also allow up to five business days to provide requested documents during routine reviews or audits of alleged violations. Within required annual training, licensed providers must spend at least three hours on children with special needs; certified family-home providers must spend at least two. This starts in the first employment year. Providers must admit specialists delivering services under a child’s individual family service plan or education program after a parent or caregiver gives written notice describing the services. School district staff are not required to deliver services there. During six-month preliminary-license probation, officials may issue violations only for knowing breaches after clear instructions or immediate threats to children. Centers receive at least two support contacts weekly, including one in person. Officials must consider self-reporting, responsibility for the problem, extra safety efforts, and corrective action. Breaking a directed correction plan warrants suspension or revocation only if the cabinet finds it serious enough. Annual training covers July 1 through June 30. Section 18’s center enforcement rules apply to actions pending but not final when the law takes effect and actions occurring on or after that date.

State officials must seek federal approval for cost-based child-care payment planning and hire a private administrator for Kentucky’s Employee Child Care Assistance Partnership. The income rule covers verified employees of licensed centers, microcenters, and certified family homes, plus owners or operators of certified family homes and licensed home-based centers. Employer assistance covers participating employers, employees, and quality-rated providers. Kentucky’s Child Care Assistance Program disregards all earned and unearned income for covered workers only as funding and federal law allow. Applicants must meet all other eligibility rules. A private administrator handles employer-program applications and payments under state oversight and routine audits. Its contract allows it to retain a percentage of employer contributions, state matching payments, or both. Employer-program contracts require enough money to cover existing and proposed obligations. Contracts wait in the order received when funds are committed. State matches depend on household income. Employers generally send contributions through the administrator. Direct payments require approval from both the administrator and provider. Unused employer contributions must be returned if a contract ends early. Family members’ agreements may cover remaining care costs without overpaying providers. The administrator contract is due by December 1, 2026. The 10% administrative limit applies starting in fiscal year 2026–2027. The federal approval request concerns the 2028–2030 child-care funding plan.

Kentucky agencies must plan quality-rating improvements, publish care and spending information, and manage voluntary community and faith-based designations. The Education and Labor Cabinet must publish a searchable monthly database of child care and early education without identifying children or staff. State reports also cover available care, potential need, and state and federal spending. Economic development officials must share community-designation information with companies seeking incentives. The Cabinet for Health and Family Services cannot change the quality-rating program without legislative authorization unless required for federal law or funding. It must notify the legislative families-and-children committee first. A separate duty requires standards suited to certified family homes and licensed home-based centers. The 34-member Kentucky Child Care Advisory Council advises the cabinet and reviews its rating-modernization plan. Appointed members must represent Kentucky’s geographic and cultural diversity and at least proportionally represent its two leading political parties by voter registration. Community certification is optional. Applicants need a representative child-care task force, a strategic plan, and a review and reform plan for local barriers. Joint applications are allowed. Communities without adopted zoning rules may omit zoning from their review. Licensed and certified providers may choose a faith-based label for state child-care databases. State agencies cannot use the label’s presence or absence to favor or discriminate against providers. Rating plans, home-setting standards, and the first annual spending report are due October 1, 2026. Monthly care reports begin December 1, 2026. Capacity tracking is due by July 1, 2027; quarterly gap reports begin that day. Final rating recommendations are due December 1, 2027.

The University of Kentucky must run a pilot testing awards tied to children’s readiness for kindergarten. The pilot covers eligible regulated child-care and early-education providers, registered providers, and parents who qualify for child-care subsidies. Participants must represent varied geographic areas and income levels. The university must set standards for a one-time $2,000 full award per child. A full award generally requires two years of full-time provider care or two years of home care by a parent who meets child-care subsidy eligibility rules. Providers must maintain infant and toddler services at required ratios and keep detailed care records. Parents must verify subsidy eligibility. The university determines assessment and payment methods and must follow federal rules. Providers qualify for a full award when a formally diagnosed disability prevents proper readiness assessment and they provided full-time care for the preceding two years. Half-day provider care combined with public preschool for the preceding two years qualifies for a half award. Awards may be split among caregivers based on who provided care during that period. The university must establish the program by August 1, 2026. The pilot operates August 1, 2027, through July 31, 2029. Annual reports begin by June 1, 2027, and final findings are due January 1, 2030.