Indiana would fund eligible child care vouchers without waiting lists

The state family services office would fund eligible child care voucher payments and keep provider payment rates at or above a set level. These rules cover applicants eligible for federal child care voucher payments and providers eligible for reimbursement. The office could not put an applicant eligible for a voucher payment on a waiting list. Full funding would start April 1, 2026; the waiting list ban would take effect upon passage.

The state family services office would ask federal officials to change its child care voucher plan. The request would set the income limit for families first seeking federal child care vouchers at 150% of the federal poverty level. The request alone would not change who qualifies; federal officials would need to allow the plan change. The office would have to submit the request by April 1, 2026.

The state would use a 150% poverty-level household income limit when deciding which children qualify for its prekindergarten program. This covers Indiana children who are at least four and under five on August 1 of the state fiscal year sought, with household income no more than 150% of the federal poverty level. The child must use an approved provider. A parent must work, study, or train, or seek work if federal officials approve that option. The parent must also agree to attendance rules. The eligibility provision would take effect upon passage; the child's age is measured on August 1 of the state fiscal year sought.

The state family services office could set a yearly cap on prekindergarten vouchers, but it could not set one below 7,500. This covers vouchers for eligible children and children in the program's limited eligibility group. The floor limits how low a cap can be; it does not promise that 7,500 vouchers will be given. The cap rule would take effect upon passage and apply each state fiscal year.

Indiana would keep prekindergarten provider rates at a set minimum and set aside state money for prekindergarten and child care voucher duties. The state money would support the prekindergarten program fund and the state office's child care voucher duties. Prekindergarten provider rates would have to stay at or above the rates in effect January 2025. The rate rule would take effect upon passage. The funding would cover July 1, 2026, through June 30, 2028.