How to become a California child care subsidy provider
California's child care subsidy system runs primarily through the Alternative Payment (AP) program, administered by Local Planning Councils and AP agencies across all 58 counties. This guide explains how to enroll, how payments work, current rate ceilings, and the compliance rules that govern subsidy participation.
California's child care subsidy programs
California funds child care subsidies through several parallel programs, all ultimately administered by CDSS. The programs that affect licensed providers most directly are:
Alternative Payment (AP) Program
The primary subsidy for working-poor families who meet income eligibility (currently up to 85% of State Median Income). Administered by AP agencies under contract with CDSS. Families choose their licensed provider; the AP agency pays the provider based on certified need and attendance. This is the program most licensed providers enroll in first.
CalWORKs Child Care (Stages 2 and 3)
Child care subsidies for families in California's welfare-to-work program. Stage 1 is administered directly by county welfare departments. Once families transition to Stage 2 and 3, they are served by AP agencies — the same agencies administering the AP program. Enrolling with your local AP agency typically covers both AP families and CalWORKs Stage 2/3 families.
General Child Care and Development (CCTR)
Federally and state-funded center-based child care and development programs contracted directly with CDSS. Most providers access this funding through an AP agency rather than a direct CDSS contract. If you want a direct CDSS contract, watch for CDSS Request for Applications (RFAs) — these are infrequent and competitive.
How to enroll as an AP subsidy provider
- 1Step 1Hold an active CCLD license
You must have a current, valid CCLD license before an AP agency can enroll you. Your license number will be verified by the AP agency. Ensure your license is current and reflects your correct capacity and age groups served.
- 2Step 2Find your local AP agency
Contact your county Child Care Resource and Referral agency (CCR&R) or visit mychildcareplan.org to identify the AP agency serving your county. Some counties have more than one AP agency — each serves different zip codes or program types. Your CCR&R can direct you to the correct agency.
- 3Step 3Request a provider enrollment packet
Contact the AP agency's provider services unit and request a provider enrollment packet. You'll need: your CCLD license certificate, Federal Employer Identification Number (EIN), W-9, voided check for direct deposit setup, your private-pay rate schedule by age group, and proof of liability insurance.
- 4Step 4Set your private-pay rate schedule
Your subsidy reimbursement rate cannot exceed your private-pay rate for the same service. Set your rates at or above the AP market rate ceiling for your county and age group — CDSS publishes these. If your private-pay rate is below the market rate ceiling, you're leaving subsidy revenue on the table. Review rates annually.
- 5Step 5Sign the provider agreement
The AP agency provider agreement specifies your obligations: maintaining your CCLD license, verifying family authorizations, recording attendance accurately, billing on schedule, cooperating with audits, and treating subsidy families consistently with private-pay families. Read the agreement carefully before signing.
- 6Step 6Verify authorizations and begin billing
When a subsidized family enrolls, verify their authorization through the AP agency before they begin care. Track attendance daily using the method specified in your provider agreement (sign-in sheets, electronic system, or agency-provided forms). Submit billing per the AP agency's schedule — late billing delays payment.
Free: California AP subsidy provider enrollment checklist
Every document and step to complete your AP program provider enrollment with your local AP agency.
How subsidy payments work in California
Payment = AP agency pays subsidy portion; family pays copay
The AP agency pays the subsidy portion directly to you based on your attendance records. The family pays a copay — a sliding-scale amount based on their income — directly to you. You collect copays separately. The AP agency does not collect copays on your behalf.
Reimbursement rate ceilings by county
CDSS publishes Reimbursable Expense Rate tables annually, setting the maximum rate payable by age group and care type for each county. Your actual reimbursement rate is the lesser of your private-pay rate or the rate ceiling. Verify current rate tables at cdss.ca.gov — rates are updated periodically.
Absent day policy — verify with your AP agency
California's absent day reimbursement rules are specified in your provider agreement and may vary by AP agency. Generally, a limited number of absent days per month are reimbursable. Days beyond the limit are not paid. Track attendance carefully.
Equal treatment of subsidy families required
You cannot charge subsidy families any additional fees not charged to private-pay families for the same services. Registration fees, activity fees, and supply fees must be applied consistently. Fee discrimination is grounds for removal from the AP program.
License lapse terminates subsidy enrollment
Any CCLD license revocation, suspension, or expiration immediately terminates your AP provider enrollment. Maintain your license and annual renewal without interruption. If your license lapses for any reason, contact your AP agency immediately and stop billing for subsidized families.
Frequently asked questions
What is the difference between the Alternative Payment program and CalWORKs child care in California?
CalWORKs child care is specifically for families receiving or transitioning off CalWORKs (welfare-to-work) cash aid, administered in three stages: Stage 1 (county welfare department), Stage 2 (AP agency), and Stage 3 (AP agency or other contractor). The Alternative Payment (AP) program serves income-eligible families who are not in CalWORKs — it's a broader subsidy available to working-poor families who meet income guidelines. As a licensed provider, enrolling with your local AP agency typically gives you access to both AP and CalWORKs Stage 2/3 families.
How do I get paid as a California subsidy provider?
Payment comes from the AP agency, not from the family. The AP agency pays the subsidy portion based on the family's income and certified need. Families pay a co-payment (copay) directly to you — the AP agency determines the copay amount based on family income. You must track attendance and submit it to the AP agency per their billing schedule, typically monthly. AP agencies pay via direct deposit after verifying attendance records.
Can a family day care home provider participate in the AP program?
Yes. Both licensed Family Day Care Homes (Small and Large) and Child Care Centers can participate in the Alternative Payment program. The requirements are the same: a valid, current CCLD license and a signed provider agreement with the local AP agency. Family day care home providers often find that subsidy enrollment fills their enrollment quickly given the high demand and limited licensed capacity in many California markets.
What is the maximum subsidy reimbursement rate in California?
California sets market rate ceilings by county, license type, and age group — these are published in the Reimbursable Expense Rate tables issued by CDSS. Reimbursement rates for the AP program are generally set at or near the 75th percentile of market rates for each county. The exact rate you receive cannot exceed your private-pay rate, so ensure your private-pay tuition is set at or above the AP market rate ceiling for your county and age groups.
What happens if a subsidy family stops attending without notice?
Your AP agency provider agreement specifies the absent day allowance — California typically allows reimbursement for a limited number of absent days per month (verify current limits with your AP agency). If a family leaves without proper notice, contact your AP agency immediately to terminate the authorization. You cannot continue billing for a family that is no longer attending. Document all attendance accurately — AP agencies conduct audits and over-billing for absent days is treated as fraud.
What is the Local Planning Council (LPC) and how do I find my local AP agency?
California has 62 Local Planning Councils (LPCs) that plan and coordinate child care and development services at the county level. Each LPC is associated with one or more Alternative Payment agencies that administer the AP program locally. To find your local AP agency, contact your county CCR&R (Child Care Resource and Referral agency) or go to mychildcareplan.org — the statewide child care planning website. The AP agency in your county is your primary enrollment contact.
Related guides
Official subsidy resources
Get the complete California AP subsidy enrollment checklist
Every document, step, and compliance requirement to complete your AP program enrollment and start receiving subsidy payments.
Get the complete California subsidy provider guide
The full guide covers the AP agency enrollment process, provider agreement key clauses, rate ceiling tables by county, absent day billing rules, and the audit compliance checklist.
View the California subsidy provider guide — $4.99Instant access after purchase · Last verified May 2026
Information current as of May 2026. Verify current AP program requirements with your local AP agency and at cdss.ca.gov. CloverMap is not affiliated with California CDSS.