799.1

us-hi-regs-official-c300f6364aec1de4058121d6226add95ae33ada15b679ac683e655ae07ddf9bc799.1Regulation

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HAWAII ADMINISTRATIVE RULES
TITLE 	17
DEPARTMENT OF HUMAN SERVICES
SUBTITLE 	6
BENEFIT, 	EMPLOYMENT AND SUPPORT SERVICES 	DIVISION
§17-799.1-1
§17-799.1-2
§17-799.1-3
§17-799.1-4
§17-799.1-5
§17-799.1-6
§17-799.1-7
§17-799.1-8
§17-799.1-9
§17-799.1-10
§17-799. 1-11
§17-799.1-12
§17-799.1-13
§17-799.1-14
§17-799.1-15
CHAPTER 799.1
PRESCHOOL OPEN DOORS PROGRAM
General 	Pr o visions
Purpose
Definitions
Confidentiality
Scope
Application period
Application process
Family unit eligibility requirements
Income 	considered in 	eligibility
determination
Excluded monthly income
Program enrollment
Program qualifications 	for preschools
Accreditation
Child 	care 	rates
Method of computing 	family unit's
co-payment
Method of computing 	c hild care payment
799 . 1 - 1
§17-799.1-1
§17-799 . 1-16
§17-799.1-17
§17-799.1-18
§17-799.1-19
§17-799.1-20
§17-799.1-21
§17-799.1-22
§17-799.1-23
§17-799.1-24
Child care payments
Mandatory 	reporting
Continued eligibility and payment amo unt
Waitlisted applicants
Denial, 	reduction, 	suspension, 	or
termination of child care payments
Notices
Administrative 	appeal requests
Underpayments and overpayments
Termination 	for 	insufficient 	funds
Historical 	Note: 	Chapter 	17-799.1 	is based
substantially upon chapter 	17 - 799, 	Preschool Open
Doors. 	(Eff 	02/09/14; 	am and comp 12/31/17; 	am and
comp 	01/12/24; 	am and comp 	06/27 /25; 	R 	MAY 2 9 2025
GENERAL PROVISIONS
§17-799.1-1 	Purpose. 	Child care payments 	under
this 	chapter 	shall 	be 	for 	early childhood services to
low- 	and moderate-income 	families 	that support
families 	in accessing early 	learning 	services 	for
young 	children by providing 	up 	to 	three 	school 	years
o f 	experience 	in a 	preschool program chosen by 	the
child's 	caretaker prior 	to 	the 	child entering
kindergarten. 	The 	intent 	of 	the 	program is 	to 	provide
child care payments 	to as many eligible 	families 	as
possible 	through 	the 	funding 	that 	is appropriated and
avMq~lRQle 	for 	the State fiscal 	year. 	[Eff
AT 2~ 2026 	) 	(Auth: 	HRS §§346-14, 	346-181) 	(Imp:
HRS 	§§346-14, 	346-181)
§17-799.1-2 	Definitions. 	As used in this
chapter:
"Accredited" 	means 	a 	group child care 	center, 	or
group child care home, 	that 	is 	certified to meet
799.1-2
§17-799.1-2
accreditation 	standards by 	the 	National Association
for 	the 	Education of Young Children 	(NAEYC), 	the
National 	Early Childhood 	Program Accreditation
(NECPA), 	the 	National 	Association of 	Family Child Care
(NAFCC), 	or other accrediting 	organization approved by
the 	director.
"Adequate notice" means a 	written notice that
includes:
(1) 	A statement of the action the agency has
taken or 	intends 	to take;
(2) 	The reason 	for 	the intended action;
(3) 	The specific departmental 	rules 	supporting
the 	intended action;
(4) 	The 	name 	and 	telephone number 	of 	the person
in 	the 	department 	to contact 	for 	additional
information;
(5) 	The 	family 	unit's 	right 	to 	request an
informal 	review, 	an administrative appeal,
or 	both; 	and
(6) 	Information on the availability of 	free
legal representation, 	if 	applicable.
"Applicant" 	means 	the 	caretaker, 	including an
emancipated minor pursuant 	to 	sections 	571-2 and
577-25, 	HRS, 	and a 	teenage 	head of the household,
who has 	the 	responsibility to 	provide care 	for 	the
child, 	and needs 	child care. 	This 	does 	not 	include
an unmarried minor who is 	a 	parent 	to 	the
individual's 	own baby who 	together 	reside 	in the
same household with the minor's 	adult caretaker.
"Application" means 	the department prescribed
form 	by 	which an 	individual 	indicates a 	request 	to
receive, 	or 	continue 	to 	receive 	assistance 	with 	child
care 	costs and 	services.
"Application period" means the 	fourteen month
period 	from April 	1 	prior 	to 	the 	start of 	the
upcoming 	specified program year 	through May 	31 of
the 	current 	specified program year 	wherein 	an
application 	is 	received by 	the department, 	and the
department 	reviews 	the 	applications 	in
chronological 	order of when 	the department 	received
the 	application.
"Background check" means a 	review of a 	person's
background information pursuant to chapter 17-801.
799 . 1- 3
3630- ~
§17-799.1-2
"Benefit month" means 	the 	calendar month 	for
which the caretaker 	is 	eligible 	for a 	child care
payment.
"Budget month" 	means 	the 	calendar month(s) 	for
which the 	child care expense and income of a 	family
unit are used to compute the payment amount 	that 	the
family 	unit 	shall 	receive 	in 	the payment month.
"Caregiver" means 	any 	individual who is
responsible 	for 	the 	physical 	well-being, 	health,
safety, 	supervision, 	and guidance of children in child
care.
"Caretaker" means 	an adult who 	resides with and
is 	responsible 	for 	the 	care of a 	child, 	and who is a
birth, 	hanai, 	foster, 	or 	adoptive parent, 	guardian,
step-parent, 	or 	relative 	who 	is 	related 	to the 	child
by blood, 	marriage, 	or adoption, 	or a 	person
authorized by the 	caretaker 	through a 	power 	of
attorney valid 	for 	a 	period not 	to exceed 	twelve
months. 	The 	caretaker designation may 	remain even
when 	the caretaker 	is 	temporarily absent 	from 	the home
as 	long as 	the caretaker 	continues 	to maintain
responsibility 	for 	the care, 	education, 	and 	financial
support of the 	child. 	This 	includes a 	foster 	parent
who may 	not be providing 	financial 	support 	to the
child but may be 	receiving 	support 	for 	the 	child from
a 	private or public 	agency. 	This 	also includes 	teen
parents who 	are birth parents 	to the child .
"Child" means any person who has not 	reached the
age 	of eighteen years, 	excluding emancipated minors.
"Child care" 	means those 	situations 	in which a
caregiver has 	agreed to assume the 	responsibility 	for
the child's 	supervision, 	apart 	from and 	in the absence
of 	the 	child's 	caretaker, 	for 	any 	part of 	a 	twenty-
four-hour day. 	Child care, 	for 	the 	purposes 	of 	this
chapter, 	is 	limited 	to care 	provided 	in a 	group child
care home, 	or 	in a 	group child care 	center.
"Co-payment" means 	the 	family 	unit's 	share of the
child care 	expense which 	is 	the difference between t he
maximum payment amount allowed 	for 	the 	type and amount
of 	care up 	to the department's 	child care payment 	rate
maximum, 	and 	the 	amount 	the 	family 	unit 	is determined
to be 	eligible 	for 	by the 	department.
"Department" means 	the department of human
services 	or 	its designee.
799.1-4
§17-799.1- 2
"Domestic violence" means 	a 	situation where an
individual has been battered or otherwise subjected to
extreme 	cruelty. 	Acts 	which constitute domestic
violence 	include but are not 	limited to the 	following :
(1) 	Physical 	acts 	that 	resulted 	in, 	or
threatened to result in, 	physical 	injury;
(2) 	Sexual abuse;
(3) 	Sexual 	activity involving a 	dependent child;
(4) 	Nonconsensual 	sexual acts;
(5) 	Threats of, 	attempts at, 	physical or sexual
abuse;
(6) 	Mental or emotional 	abuse;
(7) 	Medical 	care deprivation or neglect; 	or
(8) 	Stalking.
"Eligibility period" 	means 	a 	period up 	to 	three
specified program years, 	established by 	the department,
that 	shall 	not exceed the 	date on which 	the applying
child becomes eligible to attend 	kindergarten, 	in
accordance with 	section 302A-411, 	HRS.
"Exempt" or 	"Exempt 	center-based provider" means
a 	facility providing 	legally-exempt 	child 	care, 	in
accordance with 	section 	346-152.5, 	HRS, 	that is 	in
compliance with chapter 	17-800. 	It also 	includes 	all
staff employed at a 	child care 	facility, 	any
volunteers who provide care 	for 	children 	for 	ten hours
or more per week, 	substitutes, 	and any other
individuals who have 	unsupervised access 	to children
in exempt 	center-based care.
"Experiencing homelessness" means 	a 	family unit:
(1) 	Lack a 	fixed, 	regular, 	and adequate
nighttime 	residence;
(2) 	Are 	sharing the 	housing of other persons 	due
to 	a 	loss 	of housing, 	economic hardship, 	or
a 	similar 	reason, 	are 	living 	in motels,
hotels, 	or camping 	grounds 	due 	to the 	lack
of 	alternative adequate 	accommodation, 	are
in emergency or transitional 	shelters, 	are
abandoned 	in hospitals;
(3) 	Have a 	primary nighttime 	residence 	that
is a 	public or private place 	not
designed 	for or ordinarily used as a
regular 	sleeping accommodation 	for 	human
beings;
(4) 	Are 	living 	in cars, 	parks, 	public 	spaces,
abandoned buildings, 	substandard housing,
799.1-5
§17-799.1-2
bus or train stations, 	or similar settings;
or
(5) 	Are migratory children 	(as 	the 	term is
defined in section 1309 of the 	Elementary
and Secondary Education Act of 1965).
"Family unit" means 	the caretakers and their
minor children who 	reside 	together 	in the 	same
household.
"Federal 	Poverty Guidelines" 	or 	"FPG" 	means
the 	poverty guidelines 	for 	Hawaii 	that are
established in the 	Federal Register by the 	U.S.
Department of Health and Human 	Services under 	the
authority of 	42 	U.S.C. 	§9902(2) 	and cited in the
Child Care and Development 	Fund Plan 	For State of
Hawaii that 	is 	approved by the Administration 	for
Children and 	Families, 	U.S . 	Department of Health
and Human 	Services, 	pursuant 	to 	45 C.F.R. 	§§98.14
to 	98.18.
"Gross income" means all 	non-excluded earned and
unearned income 	as 	specified in 	this chapter.
"Group 	child care center" 	or 	"GCC" 	means 	a
facility, 	other than a 	private 	home, 	at which care 	is
provided, 	as 	defined in section 346-151, 	HRS.
"Group 	child 	care home" 	or 	"GCCH" 	means a
facility, 	which may be an extended or modified private
home, 	at which care 	is provided 	to 	seven 	to twelve
children, 	as defined in 	section 	346-151, 	HRS.
"Hanai" means a 	child who 	is 	taken permanently 	to
be 	reared, 	educated, 	and loved by someone other 	than
the 	natural 	parents 	at the 	time of 	the child's birth
or early childhood. 	The 	child is 	given outright and
the 	natural 	parents 	renounce all 	claims 	to the child.
The 	natural 	parents 	cannot 	reclaim the 	child except
for 	the death or serious 	injury of the 	hanai 	parents.
"Hawaiian-medium center - based care" means a 	group
child care center, 	as defined in 	section 346-151, 	HRS,
with programs 	taught 	solely 	in the 	Hawaiian 	language
that 	promote 	fluency 	in the Hawaiian 	language and 	that
is 	licensed by the 	department 	in accordance with
section 	346-162, 	HRS.
"Limited English proficiency" 	or "LEP" means
limited 	ability in speaking, 	reading, 	writing, 	or
understanding 	the English language by a 	person whose
799.1 - 6
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§17-799.1-2
native 	language is a 	language other than English or by
a 	person who 	lives 	in a 	family or 	community
environment where a 	language other 	than English 	is 	the
dominant 	language.
"Low-income" means gross 	income 	less 	than or
equal to 	one hundred eighty-five per 	cent of 	the
Federal 	Poverty Guidelines.
"Minor" 	means a 	person under eighteen years
old.
"Moderate-income" means 	gross 	income greater than
one 	hundred eighty-five per cent and 	less 	than or
equal 	to 	five 	hundred per cent of the 	Federal 	Poverty
Guidelines.
"Monthly gross 	income limit" 	means 	five 	hundred
per 	cent of the Federal 	Poverty Guidelines 	for 	a
family 	of 	the 	same size.
"Non-recurring lump sum" means 	income that 	is not
normally repeated or a 	cumulative amount 	received or
available 	to be 	received by an 	individual.
Educational 	loans, 	grants or 	scholarships 	shall not be
considered as 	non-recurring 	lump 	sums.
"Overpayment" means the 	amount 	of payments 	issued
to 	a 	caretaker 	for 	a 	benefit month 	that 	is 	in excess
of 	the 	amount which the 	caretaker 	is 	eligible t o
receive. 	It 	also 	includes 	payments 	that 	are not 	used
for 	their 	intended purpose.
"Payment month" means the 	calendar month in which
a 	child care payment 	is 	issued.
"Power of attorney" 	means 	a 	legal 	instrument
authorizing another to act as 	one's agent or attorney-
in-fact.
"Preschool" means 	a 	Group Child Care Center 	(GCC)
or Group Child Care Home 	(GCCH) 	that provides 	services
for 	children ages 	two 	years 	to six 	years 	old.
"Prospective budgeting" 	means 	computation of the
child care payment based on 	the worker's 	best estimate
of 	the child care 	expense and gross 	income that 	will
exist 	in a 	calendar month. 	The best estimate shall 	be
based on the worker's 	reasonable projection of 	future
circumstances based on the 	family 	unit's 	past 	and
current month's 	circumstances .
"Relative" means a 	person related by blood,
marriage, 	adoption, 	or hanai.
799 . 1- 7
§17-799.1-2
"Report 	form" 	means 	the 	form prescribed by the
department that a 	family 	unit 	is 	required to complete
for 	continued eligibility for 	the next 	specified
program year.
"Reside with" means an eligible 	child living 	in a
home or 	family 	setting 	with the 	child's 	eligib l e
caretaker.
"Self-employment" means 	an 	individual 	is not
subject 	to discharge 	from his 	or her 	job by 	another
person, 	reports 	income 	to the 	Internal 	Revenue Service
and 	the 	State as 	a 	self-employed person and pays
employer's 	and employee's 	share 	of 	social 	security
taxes, 	is 	not considered an employee of an agency or
organization, 	and generates 	income equivalent 	to
twenty hours 	per week multiplied by 	4.3333 weeks
multiplied by the 	State minimum wage at 	the 	time of
eligibility determination and redetermination.
"Special populations 	referral" means
documentation to verify that a 	child does not qualify
full-time 	for 	the 	state 	department of education
(DOE)special 	education program services 	and :
(1) 	Has a 	physical, 	developmental, 	behavioral or
emotional 	health 	condition 	that 	is 	outside
of 	the 	normal 	range;
(2) 	Meets 	the 	state department of health
criteria for 	environmental 	risk as defined
in HRS §321-351;
(3) 	Resides 	in a 	LEP household; 	or
(4) 	Is experiencing homelessness 	and the 	family
is 	participating 	in or 	enrolling 	in a
program for 	homeless 	services.
"Specified program year" 	means 	the 	state 	fiscal
year during which 	the child will be 	attending 	child
care.
"State 	fiscal 	year" means 	a 	period beginning
July 1 	and ending 	June 	30.
"Temporarily absent" 	means a 	period of up 	to
ninety days 	when the caretaker is not residing 	in 	the
home 	with 	the child as 	a 	result of employment or 	job
training 	commitments.
"Temporary Assistance 	for 	Needy 	Families" 	or
"TANF" means 	the 	federal 	and state 	financial
assistance 	and non-assistance programs 	administered by
the department under 42 	U.S.C. 	§§601-617 and HRS §346-
29.
799 . 1-8
3 6,3 0
§17-799.1-4
ttTimely notice" means when the department mails a
notice of 	adverse action at 	least 	ten calendar days
prior to the effective 	date of 	the action.
" Underpayment" 	means 	the amount 	of payments
issued to a 	caretaker 	for a 	benefit month 	that is 	less
than 	the amount 	which the 	caretaker was 	eligible to
receive. 	[Eff 	MAY 2 9 2026 	] 	(Auth: 	HRS
§§346-14, 	346-181) 	(Imp: 	HRS §§346-151, 	346-181)
§ 17-799.1-3 	Confidentiality. 	Requirements 	for
confidentiali ty sha ll 	be 	as 	provided in 	chapter
17-601. 	[Eff MAY 2 9 2026 	l 	(Auth: 	HRS §§346-10
and 346-14) 	( Imp: 	HR S §346-10)
§17-799.1-4 	Scope. 	(a) 	Child care 	services
shall 	include, 	but 	are not 	limited 	to:
(1) 	Supervision 	to assure the child's 	safety,
comfort, 	and 	health;
(2) 	Personal 	care as 	appropriate 	to the 	child's
age and developmental 	maturity;
(3) 	Activities appropriate 	to 	the 	child's 	age,
developmental 	stage, 	and degree of physical
or mental 	ability; 	and
(4) 	Health and nutritional 	services.
{b) 	Child care 	services shall exclude:
(1) 	Services provided to a 	child enrolled in o r
eligible 	for 	public education 	in
kindergarten 	to 	twelfth 	grade during 	th e
regular school 	day;
(2) 	Services 	for 	which a 	child receives 	academi c
credit 	toward graduation;
(3) 	Any instructional services 	that supplants o r
duplicates 	the academic program of any
public or 	private 	school 	which 	is
established 	for 	the purpose of compliance
with the 	school 	attendance law of Hawaii; 	or
(4) 	Services that provide specialized training 	or
skill development to children, 	as 	indicated 	in
section 346-152 (a) (4), 	HRS.
(c) 	Child care payments 	shall 	only be 	used 	for
services described in subsection 	{a) . 	[Eff MAY 2 9 2026
799.1-9
3i30-"'
§17-799.1-4
] 	(Auth: 	HRS §§346-14, 	346-181) 	{Imp:
HRS §§346-14, 	346-181)
§17-799.1-5 	Application period. 	There 	is
established an application period as 	defined 	in this
chapter 	for 	each 	specified program year. 	Applications
received during 	the application period 	for 	the
specified program year 	shall 	be processed in
accordance with 	section 	17-799.1-6; 	provided that the
department may refuse 	to 	take 	new applications
pursuant 	to section 	17-799.1-24 due 	to 	insufficient
funds. 	[Eff 	MAY 2 9 2026 	] 	(Auth: 	HRS §§346-14,
346-181) 	(Imp: 	HRS §§346-14, 	346-181)
§17-799.1-6 	Application process. 	(a) 	A
request 	for 	child care payments 	shall be submitted
on 	an application 	form prescribed by the department.
(b) 	The 	form 	shall 	be dated and signed by the
applicant under penalty of 	law that 	all 	the
information needed to establish eligibility for 	child
care payments, 	as 	stated on the 	form, 	is 	true and
correct.
(c) 	The applicant 	shall 	be 	required to 	submit
copies 	of documents 	for 	verification o f 	the
information provided to establish eligibility 	for 	the
program.
(d) 	The 	date 	of 	application 	shall 	be 	the 	date
the 	signed and dated application form is received by
the 	department.
shall 	be allowed 	to apply
children reside 	in
(e) 	Only one applicant
for 	child 	care payments 	when
different 	households 	because
[Eff MAY 2 9 2026 	] 	(Auth:
(Imp: 	HRS §§346-14, 	346-181)
of 	joint or shared custody.
HRS §§346 - 14, 	346 - 1 81)
§17-799.1-7 	Family unit eligibility requirements.
(a) 	The department 	shall 	verify 	that the appli c a nt's
child and the 	family 	unit meet 	the eligibility
requireme nts 	as 	described in this 	chapter.
799.1 - 10
3 6 3 0 -
§17-799.1-7
(b)
under 	this
( 1)
( 2)
A child eligible 	for 	child care payments
chapter shall:
Reside with 	the 	eligible caretaker; 	and
Be 	eligible 	to enter 	kindergarten by the
end of 	the specified program year or are
two or 	three 	years 	old by July 31 	of the
specified program year.
(c) 	Applications 	received during the
application period for 	children not described in
subsection 	(b) 	shall 	be denied pursuant to 	section
17-799.1-20 and be 	sent a 	notice 	in accordance with
section 	17-799.1-21.
(d) 	A child 	receiving child 	care payments under
this 	chapter shall 	not be 	eligible 	to receive 	child
care payments 	under 	chapter 17-798.3 	for 	the 	same
preschool provider or same type 	of 	care.
(e) 	A family 	unit 	shall 	be eligible 	for 	child
care payments provided the 	family 	unit has month l y
gross 	income verified 	through documentation 	that does
not 	exceed 	five 	hundred 	per cent of the 	Federal
Poverty Guidelines 	for 	a 	family 	of 	the 	same 	size,
which shall 	be 	updated annually 	on 	February 	1 	to
determine 	eligibility for 	the next 	specified program
year.
(f) 	A family 	unit 	in which 	the caretaker 	is a
foster 	parent licensed by 	the department, 	or 	by an
organization under 	the authority of the department,
shall not be 	subject 	to 	income 	limits 	for determining
eligibility, 	and are 	not 	subject 	to the 	family 	unit's
co-payment 	requirement 	under section 17-799 . 1-14,
when 	the 	applying 	child 	is a 	foster 	child.
(g) 	A family 	unit who meets 	the eligibility
conditions 	of 	this 	section, 	but 	is 	not selected 	to
participate 	in the program due 	to 	lack of 	funds 	shall
be placed on a 	waitlist 	and assigned a 	waitlist
priority as 	established in 17-799.1-19.
(h) 	When 	the 	family 	unit 	is 	experiencing
homelessness 	or domestic violence, 	as defined in 	this
chapter, 	and does 	not have 	documentation 	to 	support
verification of subsection 	(b), 	and 	section 	17-799 . 1-
8, 	the department may 	issue presumptively eligible
payments pending 	receipt 	of 	the documentation within
two months 	from 	the 	first 	calendar day of 	the 	initial
month 	of presumptive 	eligibility for 	the 	family 	unit,
provided that :
799.1-11
3 6 3 0 -
§17-799.1-7
(1) 	Payments 	shall be 	terminated after 	two
months 	if the 	family 	unit 	fails 	to submit
verifying documentation within two months;
and
(2) 	Such presumptively eligible payments 	are
not considered an overpayment under 	section
17-799.1-23.
(i) 	Child care 	payments 	will 	continue 	as 	long 	as
the 	family unit 	remains 	eligible 	under 	this 	chapter,
and 	until 	the applicant's 	child 	reaches 	kindergarten
eligibility pursuant 	to 	section 	302A-411, 	HRS,
provided that 	the 	family 	unit 	continues 	to meet all
other eligibility 	requirements. 	[Eff MAY 2 9 2026
(Auth: 	HRS §§346-14, 	346-181) 	(Imp: 	HRS §§346-14,
346-181)
§17-799.1-8 	Income considered in e ligibility
determination. 	(a) 	Monthly gross 	income 	sha ll b e 	u sed
to det e rmi n e 	income eligibility of the 	famil y 	uni t 	by
us ing o n e 	of 	the 	follo wing :
(1) 	The average of 	the prior two months gross
income 	for existing employment;
(2) 	The monthly gross income received in the
prior month 	for 	existing 	employment; 	or
(3) 	The monthly gross 	income that 	is 	anticipated
to be 	received by 	the 	family 	unit, 	such as,
but 	not 	limited to, 	from 	prospective
employment.
(A) 	Weekly gross 	income 	anticipated to be
received shall be 	converted to a
monthly gross 	income by multiplying the
weekly 	income by 	4.3333.
(B) 	Bi - weekly gross income anticipated to
be 	received shall 	be 	converted to
monthly 	income by multiplying the bi-
weekly 	income by 2.1667.
(C) 	Semi-monthly 	income 	anticipated to be
received shall be converted to monthly
income by multiplying the semi - monthly
income 	by 2.
(4) 	Gross 	income 	from 	the caretakers' 	business
or self-employment 	such as 	selling 	real
estate, 	or engaging 	in 	fishing 	and 	farming,
799.1-12
§17-799.1-8
which provide 	irregular income over a 	period
of 	six months, 	may be 	allowed to be averaged
to determine 	the budget month amount.
(b) 	Monthly gross 	income means monthly 	sums of
income received 	from sources 	such as 	but 	not 	limited
to:
(1) 	Gross 	income 	(before 	deductions 	are made 	for
items 	such as, 	but not 	limited to, 	taxes,
union dues, 	bonds, 	and pensions) 	from:
(A) 	Wages;
(B) 	Salary;
(C) 	Armed forces 	pay, 	excluding basic
housing allowance;
(D) 	Commissions;
(E) 	Tips;
(F) 	Piece-rate payments; 	or
(G) 	Cash bonuses earned.
(2) 	Social 	security pensions 	and survivors'
benefits 	(prior 	to deductions 	for medical
insurance) 	including:
(A) 	Railroad retirement insurance checks
from 	the 	U.S. 	government; 	and
(Bl 	Permanent disability insurance payments
made by 	the 	Social Security
Administration .
(3) 	Unemployment 	insurance benefits 	such as:
(A) 	Compensation received from government
unemployment 	insurance agencies 	or
private 	insurance 	companies during
periods 	of unemployment; 	and
(B) 	Any strike benefits 	received from union
funds.
(4) 	Worker's 	compensation benefits and temporary
disability insurance benefits:
(A) 	Worker's 	compensation benefits 	include
compensation received 	from private 	or
public 	insurance companies 	for 	injuries
incurred at work;
(Bl 	Temporary disability insurance benefits
include 	compensation 	received 	from
private 	or public insurance 	companies
for 	short-term disabilities 	resulting
from off-the-job 	sickness 	or 	injury;
and
799.1-13
3 ,6 3 0 	-
§17-799.1-8
(C) 	The 	cost of 	the 	insurance 	shall 	have
been paid by 	the 	employer and not by
the employee, 	and the benefits are made
to 	individuals 	who continue 	to be
considered employees of the 	company;
(5) 	Pensions 	and annuities, 	including pensions
or 	retirement 	benefits paid to a 	retired
person or the person's 	survivors by a 	former
employer or by a 	union, 	either directly or
by an 	insurance company;
(6) 	Veteran's pensions 	and other benefits, 	which
include:
(A) 	Money paid periodically by the
Veteran's Administration 	to:
(i) 	Survivors of deceased veterans; 	or
(ii) Disabled members of the armed
forces;
(B) 	Subsistence allowances paid to veterans
for:
(i) 	Education; 	or
(ii) On-the-job training; 	and
(C) 	Refunds 	paid to 	former members 	of 	the
armed 	forces as GI 	insurance premiums;
(7) 	An allotment of a 	member of the armed
forces;
(8) 	Alimony;
(9) 	Child support, 	including 	support or
maintenance 	for 	or on behalf of a 	son
or daughter who is over 	eighteen years
of age;
(10) 	Public assistance payments from another
state;
(11) 	Hawaii public assistance payments;
(12) 	Adoption assistance payments;
(13) 	Dividends 	from stockholdings or memberships
in associations;
(14) 	Periodic interest on savings 	or bonds;
(15) 	Income 	from estates 	or trust 	funds;
(16) 	Income 	from 	rental of property after
business expenses;
( 1 7 ) 	Roy alt i es ;
(18) 	Income received from self-employment:
(A) 	Income 	received 	from non-farm self-
employment means 	the 	gross 	receipts
minus expenses 	for 	an individual's own
799.1 - 14
3 6 3 0 -
§17-799.1-8
business, 	professional 	enterprise, 	or
partnerships.
(i) 	Gross receipts 	shall 	include 	the
value of all 	goods 	sold and
services 	rendered.
(ii) 	Expenses 	shall 	include the 	costs of
goods purchased, 	rent, 	heat, 	light,
power, 	wages and salaries paid,
business 	taxes, 	and other 	similar
costs.
(iii)The value of 	salable merchandise
consumed by 	the 	proprietors 	of
retail stores shall 	not be 	included
as 	part of net 	income.
(iv) 	Items such as depreciation,
personal, 	business, 	and
entertainment expenses,
transportation, 	purchase of 	capital
equipment, 	and payments 	on 	the
principal 	of 	loans 	for 	capital
assets 	or 	durable goods 	shall 	not
be deducted as business 	expenses.
Personal 	expenses 	such as 	lunches
and transportation to and 	from work
shall not be deducted as 	business
expenses.
(B) 	Income 	received 	from 	farm 	self-
employment means 	the gross 	receipts
minus operating 	expenses 	from 	the
operation of a 	farm by a 	person on the
person's own account, 	as 	an owner,
renter, 	or 	sharecropper.
(i) 	Gross receipts 	sha l l 	include the
value of 	all 	products 	sold,
government 	crop 	loans, 	money
received from the 	rental 	of 	farm
equipment to others, 	and incidental
receipts 	from the 	sale of wood,
sand, 	gravel, 	and 	s i milar 	items.
(ii) 	Operating expenses 	shall 	include
the 	cost of 	feed, 	fertili z er, 	seed,
and other 	farming 	supplies, 	cash
wages 	paid to 	farmhands
depreciation charges, 	cash rent,
interest on 	farm mortgages, 	farm
799.1-15
3 6 3 0 -
..,
§17-799.1-8
building 	repairs, 	farm 	taxes 	(not
state and 	federal 	income 	taxes),
and other 	similar expenses.
(iii) 	The value 	of 	fuel, 	foods, 	or other
farm products used for 	family
living 	shall 	not be 	included as
part of 	net 	income.
(iv) 	Items 	such as depreciation,
personal, 	business, 	and
entertainment expenses,
transportation, 	purchase of capital
equipment, 	and payments 	on 	the
principal 	of 	loans 	for 	capital
assents 	or durable goods, 	and state
and 	federal 	taxes 	paid 	shall not be
deducted as 	business expenses.
[ Eff MAY 2 9 2026 	l 	(Auth:
HRS §§346-14, 	346-181) 	(Imp:
HRS §§346-14, 	346-181)
§17-799.1-9 	Excluded monthly income. 	The
following 	types of 	income received in any given month
shall be excluded 	from consideration 	in determining
income eligibility 	for 	child 	care payments:
(1) 	Money received from the 	sale 	of property
such as 	stocks, 	bonds, 	a 	house, 	or a 	car
unless 	the person was 	engaged 	in the
business of selling the property, 	in which
case, 	the net proceeds would be counted as
self-employment 	income;
(2) 	Withdrawals of bank deposits;
(3) 	Loans;
(4) 	Gifts, 	including 	in - kind gifts 	such as 	free
room and board, 	when the 	gift 	is not a 	form
of 	compensation in 	lieu of wages or salary;
(5) 	Monies 	received in 	the 	form of a
nonrecurring 	lump sum payment 	including,
but 	not 	limited to, 	the 	following:
(A) 	Income tax refunds, 	rebates, 	or
credits;
(B) 	Retroactive 	lump sum social 	security,
SSI, 	public assistance, 	or unemployment
compensation benefits;
799.1-16
3 6 3 0 - 	<J_
§17-799.1-9
(C) 	Retroactive annual adjustment payments
in 	the veteran administration's 	(VA)
disability pensions;
(D) 	Lump sum inheritances or insurance
payments;
(6) 	Refunds of security dep o sits on rental
property or utilities;
(7) 	Capital gains;
(8) 	Earnings of minor 	children who are 	members
of 	the 	household and are 	students 	at 	least
half - time 	shall 	be excluded even during
temporary interrupti o ns in school attendance
due to semester or vacation breaks, 	provided
the minors' 	enrollment will 	resume 	fol l owing
the break;
(9} 	Loans, 	grants, 	and sch o l arships 	obtained and
used under conditions 	that 	prohibit 	use 	for
current 	living 	expenses;
(10) 	Any grant or 	loan to any undergraduate
student 	for 	educational purposes made 	or
insured under any program administered by
the 	United States Secretary of Education;
(11) 	Home produce utilized 	for 	home consumption;
(12) 	The value of an allotment under the 	Food
Stamp Act of 1977, 	as 	amended, 	7 U.S.C.
§2017;
(13) 	The value of USDA donated or 	surplus 	foods;
(14) 	The value of supplemental 	food assistance
under the Child Nutrition Act of 1966, 	42
U.S.C. 	§§1771-1789, 	and the 	special 	food
service program 	for 	children under 	the
National 	School 	Lunch Act, 	as amended,
42 	u.s.c. 	§§1751-1769;
(15) 	Benefits 	received 	from the 	special
supplemental 	food program 	for women,
infants, 	and children 	(WIC), 	42 	U.S.C.
§1771;
(16) 	Allowances 	and payments 	to participants 	in
programs, 	other 	than on-the-job 	training,
under the Workforce 	Investment Act 	(WIA) 	of
1998, 	20 	u.s.c. 	§9201;
(17) 	The 	earned 	income of 	individuals
participating 	in on-the-job training
programs under 	the Work 	Investment Act 	(WIA)
of 	1998, 	20 U.S.C. 	§9201, 	who are between 18
799.1-17
3 630-
§17-799.1-9
and 19 years 	of age 	and under 	the 	parental
control 	of another household member;
(18} 	Earned 	income 	tax credit 	(EITC) 	payments
received either as 	a 	lump sum or recurring
payments under section 3507 of the 	Internal
Revenue 	Code 	of 	1986;
(19) 	Financial assistance provided by a 	program
funded 	in whole or in part under 	title 	IV of
the Higher Education Act 	in accordance with
Pub. 	L. 	No. 	99-498;
(20) 	Payments or allowances made 	under 	any
federal, 	state, 	or 	local 	laws 	for 	the
purpose 	of energy assistance;
(21) 	Assistance payments 	received as 	a 	result of
a 	declared 	federal major disaster 	or
emergency from 	the 	federal 	emergency
management agency 	(FEMA), 	and other
comparable disaster assistance provided by
any 	state 	or 	local 	government 	agency, 	and
disaster 	assistance organizations;
(22) 	Payments made 	from 	the Agent Orange
Settlement 	Fund or any other 	fund
established 	in 	connection with 	sett l ing
liability claims 	concerning the chemical
Agent Orange, 	Pub. 	L. 	No. 	101-201;
(23) 	Reimbursements 	from 	the Uniform Relocation
Assistance 	and Real 	Property Acquisition
Policies Act of 	1970, 	42 	u.s.c. 	§4636;
(24) 	Payments 	received under 	the Radiation
Exposure Compensation Act, 	Pub. 	L. 	No. 	101-
426, 	to compensate individuals 	for 	injuries
or deaths 	resulting 	from the 	exposure to
radiation 	from 	nuclear testing or 	uranium
mining;
(25) 	Payments to 	individuals participating 	in the
Senior Community Service 	Emp l oyment 	Program
(SCSEP) 	funded 	under 	title V of 	the Ol der
Americans Act of 1965, 	42 	u.s.c. 	§3001;
Pub. 	L. 	No. 	100-175;
(26) 	Payments 	to volunteers derived 	from the
volunteer's 	participation 	in the 	following
programs authorized by the 	Domestic
Volunteer 	Service Act of 	1973, 	42 	U.S.C.
§§5011, 	4951-4958:
(A) 	Foster grandparent program;
799.1-18
§17-799 .1-11
(B} 	Senior companion program; 	and
(C) 	Volunteers in service 	to America
(VISTA} 	and AmeriCorps programs;
(27) 	Military re-enlistment bonus;
(28} 	Foster board payments;
(29} 	All 	payments pursuant to chapter 	17-656.2;
and
(30} 	Any other payments made 	in accordance with
state and 	federal 	laws 	that 	preclude 	the
payments 	from being counted as 	income. 	[Eff
MAY 2 9 2026 	l 	(Auth: 	HRS §§346-14, 	346-
181) 	(Imp: 	HRS §§346-14, 	346-181}
§17-799.1-10 	Program enrollment. 	(a) 	The
department shall 	issue a 	designated 	form 	to as many
approved applicants, 	as 	established 	in section 	17-
799.1-7, 	that 	can be 	enrolled 	for 	child care 	payments
under 	this 	chapter within the available 	state 	fiscal
year 	funding. 	The department 	shall 	also 	issue a
designated 	form 	to 	waitlisted approved applicants who
meet 	the condition of subsection 17-799.1-19(9) .
(b} 	The 	approved applicants 	shall 	return the
completed and signed designated form no 	later 	than 	ten
working days 	from 	the date of issuance 	to 	provide 	the
name 	and address 	of 	the 	preschool 	and to verify the
cost 	of the 	preschool.
( c) 	The 	family 	unit 	shall 	choose a 	preschool
that meets 	the program qualifications 	in 	section 	17-
799.1-11.
(d) 	The 	family 	unit 	shall 	ensure 	that an ear l y
learning 	assessment 	conducted by the 	preschool 	is
submitted to 	the department.
(e) 	An applicant or 	family 	unit 	shall 	be 	subject
to section 17-799.1-20 if 	they 	fail 	to compl¥ with
subsections 	(b}, 	(c), 	and 	(d} . 	[Eff 	MAY 2 9 Z026 	)
(Auth: 	HRS 	§§346-14, 	346-181) 	(Imp: 	HRS §§346-14, 	346-
181)
§17-799.1-11 	Program qualifications for
preschools. 	A preschool 	chosen by a 	c aretaker shall:
( 1 ) 	Be 	limited for 	the purposes of 	this chapter t o :
7 99.1 - 19
§17-799 .1-11
(A) 	A group 	child care center or a 	group
child care home 	that 	is 	licensed by the
department 	in accordance with 	chapter 	17-
892.2; 	or
(B) 	An exempt 	center-based provider 	that 	is
listed with 	the department 	in 	accordance
with chapter 17-800;
(2) 	Agree to conduct 	an early 	learning
assessment 	for 	each eligible 	child who 	is
enrolled and approved to 	receive 	child
care payments 	under 	this 	chapter. 	The
early learning assessment, 	assessment
results 	reporting 	form, 	and reporting
submittal deadline, 	shall 	be 	prescribed by
the 	department; 	and
(3) 	Cooperate with the department 	for
overpayment resolution if the caretaker
chose to have 	child care payments 	forwarded
to 	the 	preschool's account pursuant 	to
subsection 	17-799.1-16 (a). 	[Eff
MAY 29 2026 	] 	(Auth: 	HRS §§346-14,
346-181, 	346-184) 	(Imp: 	HRS §§346-14, 	346-
181)
§17-799.1-12 	Accreditation. 	(a) 	A preschool
that accepts enrollment of an eligible child approved
to 	receive a 	subsidy under 	this 	chapter may be
accredited and a 	family 	utilizing 	an accredited
preschool will 	receive a 	higher payment 	rate 	as
described under section 	17-799.1-13(1).
(b) 	Accreditation by any of 	the 	following
national 	early 	learning 	accrediting 	organizat i ons
qualifies 	for 	the payment 	rate described under
section 	17-799 . 1-13(1):
(1) 	National Association for 	the Education of
Young Children;
(2) 	National Early Chi l dhood Program
Accreditation; 	or
(3) 	National Association 	for 	Family Child Care.
799.1-20
3 6 3 0
§17-799.1-14
(c) 	Notwithstanding 	subsections 	(a) 	and 	( b), 	child
care payments may be paid 	to 	a 	family 	utilizing a 	non-
accredited preschool 	under the payment 	rate 	described
under section 	17-799 .1-13 (2) . 	[Eff 	MAY 2 9 2026
] 	Auth: 	HRS §§346-14, 	346-181) 	(Imp:
HRS §§346-14, 	346-181)
§17-799.1-13 	Child care rates. 	Child care
payment 	rates 	shall be 	the 	following 	based on 	types of
care:
(1) 	$1500 	per month 	for 	accredited licensed
group 	child care center preschool, 	an
accredited exempt 	center-based provider
operating a 	group child care 	center
preschool and 	listed with the 	department,
or 	for 	Hawaiian-medium center-based care,
as defined under 	this 	chapter; 	and
(2) 	$1200 	per month 	for 	non-accredited licensed
group child care center preschool 	and group
child care home, 	or 	for a 	non-accredited
exempt 	center-based provider operating a
group child care 	center preschool 	and
listed 	in accordance with chapter 	17-800.
[Eff MAY 29 2026 	] 	{Auth: 	HRS §§346-14,
346-181) 	(Imp: 	HRS §§346-14, 	346-181)
§17-799.1-14 	Method of computing family unit's
co-payment. 	The 	follo wing 	steps 	shall 	be 	used to
compute 	the 	famil y 	unit ' s 	co-payment:
(1) 	Determine 	the monthly gross 	income 	for 	the
family 	unit;
(2) 	Identify 	the 	family 	unit 	size;
(3) 	Determine 	the 	family 	unit's 	co-payment 	tier
as 	established 	in the exhibits 	attached at
the end 	of this 	chapter:
(A) 	Effective with 	the 	2025-26 program
year, 	pursuant 	to Exhibit 	I; 	or
(B) 	Effective with the 	2026-27 	program
year, 	pursuant 	to Exhibit 	II;
( 4 ) 	Multiply 	the 	family 	unit's 	co-payment 	tier
by 	the appropriate 	rate 	as 	established in
799.1-21
§17-799.1-14
section 	17-799.1-13 or the 	actual 	child care
cost, 	and choosing the 	lesser 	amount. 	[Eff
MAY 2 9 2026 	] 	(Auth: 	HRS 	§§346-14,
346-181) 	(Imp : 	HRS §§346-14, 	346-181)
§17-799.1-15 	Method of compu ting child care
payment. 	(a) 	Child care payment shall be
computed based on :
(1) 	Mo n thl y gross 	income and househo l d 	size
of the 	famil y 	unit ;
(2) 	The preschool 	chosen by the 	family 	unit;
(3) 	The actual 	cost of child care 	selected; 	and
(4) 	The type of 	child care.
(b) 	The child care payment amount 	shall be
determined by:
(1) 	Identifying 	the type of child care selected
and approved 	for 	each eligible 	child, 	and
selecting the 	appropriate 	rate 	as
established 	in section 17-799.1 - 13;
(2) 	Comparing the 	child care allowan ce according
to 	subsection 	(b) (1) 	and the 	actual 	child
care 	cost, 	and choosing 	the 	lesser amount.
(3) 	Determining 	the 	family 	unit's 	co-payment
pursuant 	to section 17-799.1-14.
(4) 	Subtracting 	the 	family 	unit's 	co-payment
from the 	amount 	determined 	in subsection
(b)(2).
(c) 	The 	family unit 	shall be 	responsible 	for 	any
child care 	costs 	in 	excess 	of the 	child care payment.
(d) 	The 	family 	unit shall be responsible 	to pay
its 	share of 	the child care cost directly 	to the
preschool.
(e) 	The department 	shall 	project 	the 	family
unit's eligibility and mo nthly payments prospectively
for 	the entire eligibility peri o d.
(f) 	The 	initial payment shall be 	calculated from
the 	first 	calendar day of the 	initial month of
eligibility to the 	end o f 	the mo nth, 	and 	shall 	be
considered the 	first mo nth o f 	the 	eligibility period.
Eligibility shall 	further 	be determined by the 	later
of:
799.1-22
§17-799.1-16
( 1 } 	The date 	the 	eligible child began or 	resumes
attending 	the preschool designated pursuant 	to
sections 	17-799.1-10 and 	17-799.1-11 during
the specified program year; 	or
(2 } 	July 	1 	of the 	specified program year. 	[Eff
MAY 2 9 2026 	l 	(Au th: 	HRS 	§§34 6-14, 	34 6-
181) 	(Imp: 	HRS §§346-14, 	346-181)
§17-799.1-16 	Child care payments. 	(a) 	Payment
for 	child care 	shall be issued one month at a 	time and
paid 	to 	the 	caretaker; 	provided 	that 	a 	caretaker may
choose to have 	the child care payment 	forwarded by the
department as a 	direct deposit 	from 	the 	caretaker's
account 	to 	the 	preschool, 	if the 	preschool 	agrees 	to
accept 	the direct payment and 	registers 	an account
with 	the department's 	payment 	system.
(b) 	Child care payments 	include:
(1) 	A one-time only payment 	in a 	State 	fiscal
year 	for 	registration, 	which may also
include supply and activity 	fees, 	required
by 	the 	facility, 	not 	to 	exceed $250.00;
and
(2) 	Monthly 	cost 	of 	child 	care per 	child, 	as
paid, 	but not to exceed the 	child care rates
specified 	in 	section 17-799.1-13.
(c) 	The department 	shall:
(1) 	Calculate 	the 	initial 	payment based on the
date of program eligibility under 	subsection
17-799.1-15(f);
(2) 	Authorize 	the 	initial and subsequent
monthly child care payments 	during 	the
eligibility period based on 	sections 	17-
799.1-7, 	17-799.1-8, 	17-799.1-9, 	17-799.1-
10, 	17-799.1-11, 	17-799.1-13, 	17-799.1-14,
17-799.1-15, 	17-799.1-16, 	17-799.1-17, 	17-
799.1-18, 	17-799.1-20, 	17-799.1-21, 	17-
799.1-23 	and 17-799.1-24;
(3) 	Provide 	notification of 	the 	calculated
payment 	pursuant 	to section 	17-799.1-15
to the 	family 	unit 	in accordance with
17-799.1-21; 	and
(4) 	Track and monitor appropriateness and
utilization of child care 	and payments.
799.1-23
3 6 3 0 - ...
§17-799.1-16
(d) 	The child care payment 	issued 	for a 	benefit
month shall not be 	issued more 	than once except when
the 	caretaker cannot continue 	to use 	the preschool due
to 	the 	following:
(1) 	Unanticipated closure of the preschool;
(2) 	Child care had been paid for 	the month;
(3) 	The caretaker enrolls 	the 	child in another
preschool 	in the 	same month child care was
issued 	for 	the 	preschool 	referenced in
paragraph 	(d) ( 1);
(4) 	The preschool 	referenced in paragraph 	(d) (1)
refuses 	to 	refund 	the 	child care paid 	for
the month;
(5) 	The new preschool enrollment 	requires 	a
child care payment 	from 	the 	family 	unit 	for
the month; 	or
(6) 	There is 	sufficient evidence 	as 	determined
by the 	department of 	electronic benefits
theft and 	that the 	child care benefits were
stolen through card skimming, 	card cloning,
or similar fraudulent methods not committed
by the 	caretaker in accordance with chapter
17-685. 4. 	[Eff 	MAY 2 9 2026 	] 	(Auth:
HRS §§346-14, 	346- 	181) 	(Imp: 	HRS §§346-14,
346-181)
§17-799.1-17 	Mandatory reporting. 	(a) 	A
recipient of child care payments 	shall 	be responsible
to 	report the 	following 	changes 	to the department
within 	ten calendar days 	of occurrence:
(1) 	Preschool 	child is attending;
(2) 	Cost of care;
(3) 	Child care type including when a 	child is
eligible 	for 	kindergarten entry pursuant to
section 302A-411, 	HRS;
(4) 	Child is no longer attending preschool.
(5) 	Changes 	in the 	s o urce of 	h o usehold income 	or
when the monthly gross 	in co me exceeds 	the
income 	limit 	requirements 	pursuant 	to
subsection 17-799.l-7(e ) ;
(6) 	Household composition changes; 	and
(7) 	Address 	changes, 	including mailing address.
799.1-24
§17-799.1-18
(b) 	Changes may be reported 	in writing, 	in
person, 	or by telephone, 	and shall 	be 	supported by
verifying 	documentation.
(c) 	When changes are 	reported pursuant 	to 	this
section, 	the department 	shall 	take 	action on the
reported changes 	as 	follows:
(1) 	Changes 	that 	result 	in a 	lower payment 	shall
have payments 	recalculated 	for 	the 	balance
of the eligibility period, 	after 	timely and
adequate 	notice.
(2) 	Changes 	that 	result 	in a 	higher payment
shall have payments 	recalculated for 	the
balance 	of the eligibility period and the
increased payment 	issued 	starting 	in 	the
first 	available 	full 	month.
(d) 	Changes 	that are 	reported and 	verified to
affect eligibility or payment amounts 	shall 	be
implemented 	in the 	first 	month 	following 	the month 	in
which the 	change 	was 	reported, 	and the department
shall 	recover any overpayments 	from 	the date 	of 	the
occurrence. 	[Eff MAY 2 9 2026 	1 	(Auth: 	HRS §§34 6-
14, 	346-181) 	(Imp: 	HRS §§346-14, 	346-181)
§17-799.1-18 	Continued eligibility and payment
amount. 	(a) 	For 	a 	family 	unit 	receiving 	child 	care
payments 	under 	this 	chapter and where 	the eligible
child will not meet 	kindergarten entry 	requirements
pursuant 	to 	section 	302A-411, 	HRS, 	at 	the 	end of 	the
specified program year, 	the department 	shall:
(1) 	Send 	the 	family 	unit 	a 	report 	form 	for 	the
department 	to use 	for 	program planning,
budgeting, 	and administrative 	purposes 	to
confirm 	the 	family 	unit's 	intention 	to
continue 	participation 	in 	the 	next 	specified
program year; 	and
(2) 	Confirm that 	the 	family 	unit continues to
meet 	all 	eligibi l ity requirements 	under 	this
chapter .
(b) 	The 	family 	unit 	shall 	submit a 	completed
report 	form including any verifying 	documentation
confirming 	continued eligibility of 	the 	family 	unit,
child, 	and preschool 	under 	this 	chapter.
799 . 1-25
"
3 6 3 0 - 	.
§17-799.1-18
(c) 	The 	completed report 	form must be 	received
by the department by the 	due 	date 	printed on 	the
report 	form.
(1) 	A report 	form 	shall 	be 	considered 	incomplete
when:
(A) 	It 	is 	not dated and 	signed by the
family 	unit 	under 	penalty of 	law that
all 	the 	information needed to establish
continued eligibility 	for 	child care
payments, 	as 	stated on the 	form, 	is
true and correct; 	or
(B) 	It 	omits 	information 	and documentation
including, 	but not 	limited to, 	the
family 	unit's 	income, 	child 	care
receipts, 	and 	the early learning
readiness 	assessment 	that 	is 	conducted
by the 	preschool.
(2) 	If the 	family 	unit 	fails 	to 	submit a 	report
form by 	the 	due date 	printed on the 	report
form, 	or 	submits 	an 	incomplete form:
(A) 	The 	family 	unit's 	participation shall
be 	terminated 	for 	the 	next 	specified
program year; 	provided that a 	family
unit 	that was 	terminated 	for 	failing 	to
timely return 	the 	report 	form will 	be
subject 	to 	section 	17-799.1-20, 	and may
still 	submit a 	new application 	for 	the
specified program year pursuant 	to
section 	17-799 . 1-5; 	and
(B) 	The department 	shall 	provide a 	timely
and adequate 	notice 	in accordance with
section 	17-799.1-21.
(3) 	The 	family 	unit 	shall provide 	information 	to
the department 	on the 	report 	form 	that 	shall
include, 	but 	is 	not 	limited to, 	those 	items
referenced in 	section 	17-799.1-17;
(4) 	The 	family unit 	shall 	also submit to 	the
department 	the 	completed designated 	form as
referenced in 	section 	17-799.1-10 to
establish continued eligibility and 	to
calculate child 	care 	payments 	for 	the 	next
specified program year pursuant 	to 	sections
17-799.1-15 and 17 - 799.1 - 16.
(5) 	Child care payments 	shall 	only be authorized
for 	the 	next 	specified program year 	provided
799.1-26
3630-
§17-799.1-18
the 	family unit has 	submitted the completed
report 	form 	and the 	required documentation
to establish 	continued eligibility.
(d) 	Continued eligibility shall 	include a
determination by 	the department 	that 	the preschool
selected by 	the 	family meets 	the 	requirements 	of
section 17-799.1-11.
(e) 	The department 	shall 	take 	action on any
other reported changes that are 	verified to affect
eligibility or payment amounts, 	in addition to 	those
required under subsections 	(c) 	and 	(d) 	and sections
17-799.1-11 and 17-799.1-17, 	after 	timely and adequate
notice. 	The department shall 	take 	action on 	the
reported changes 	and calculate payments 	for 	the
balance 	of 	the eligibility period as 	follows:
(1) 	Changes 	that 	are 	reported within 	ten
calendar days 	of 	the 	occurrence, 	that 	result
in a 	higher payment, 	shall 	be 	implemented 	in
the 	first 	month 	following 	the month 	in which
the 	change was 	reported;
(2) 	Changes 	that are 	reported after ten 	calendar
days 	of 	the occurrence, 	and 	result 	in a
higher payment, 	shall 	be 	implemented 	in 	the
second month 	following 	the month 	in 	which
the change was 	reported; 	and
(3) 	Changes 	that are 	reported 	that 	result 	in a
lower payment, 	due 	to a 	lower 	cost 	of 	care
or 	selection of a 	child 	care 	type 	that 	has 	a
lower maximum payment 	rate, 	shall be
implemented 	in 	the 	first 	month 	following 	the
month 	in which 	the change was 	reported, 	and
the department 	shall 	recover any
overpayments 	from the 	date of the
occurrence.
(f) 	When a 	child is 	eligible 	for 	kindergarten
entry, 	pursuant 	to sections 	302A-411 	and 	302A-1132,
HRS, 	the 	child care payments 	shall 	be 	terminated 	for
the 	duration of 	the 	existing 	eligibility period and
the 	department 	shall 	provide 	timely notice 	in
accordance with 	section 	17-799.1-21.
(g) 	Child care payments 	shall 	not be authorized
for 	the 	chosen preschool 	until 	the 	requirements of
section 	17 - 799.1 - 11 are met.
(h) 	When a 	family 	unit 	reports 	a 	change 	in the
selected preschool, 	the department 	shall 	follow
799 .1 - 27
§17-799.1-18
sections 	17-799.1-10, 	17-799.1-11, 	17-799.1-13, 	17-
799.1-14, 	17-799.1-15, 	and 17 - 799.1-16. 	[Eff
MAY 2 9 2026 	] 	(Auth: 	HRS §§346-14, 	346-181)
(Imp: 	HRS §§346-14, 	346-181)
§17-799.1-19 	Waitlisted applicants. 	(a) 	If 	an
application has 	been approved but 	all 	available 	funds
have been 	obligated, 	the applicant 	shall 	be 	placed on
a 	waitlist 	in chronological order of when 	the
department 	received the 	approved application.
(b) 	Waitlisted applicants 	shall 	be provided
written notification as referenced in subsection
17-799.l-21(b).
(c) 	While on the 	waitlist, 	the applicant may be
required to 	update 	information 	contained in 	the
application.
(d) 	Availability of 	funding 	shall be 	reevaluated
periodically by the department during the State 	fiscal
year 	to determine 	if 	funding 	is 	available 	to enroll
waitlisted applicants.
(e) 	Upon determining 	funds 	are available, 	the
department 	shall 	select waitlisted applicants 	by
the 	chronological 	order of the waitlist as
described 	in 	subsection 	(a) 	and, 	if 	there are 	not
enough 	funds 	for 	all waitlisted applicants, 	then
the 	department will 	further determine priority
groups 	in the 	following 	order from 	the highest
priority to 	lowest:
(1) 	Children eligible 	to enter 	kindergarten
by the end of 	the 	specified program year;
(2) 	Children who are 	three 	years 	old by July
31 	of the 	specified program year; 	and
(3) 	Children who are 	two 	years old by July 	31
of 	the 	specified program year.
Waitlisted applications 	shall be 	income-ranked from
lowest 	to 	highest within 	their priority group, 	by
dividing 	their monthly gross 	income 	by 	five 	hundred
per 	cent of the 	Federal 	Poverty 	Guidelines 	in
effect 	for 	the 	specified program year 	for 	a 	family
of 	the 	same 	size, 	as 	updated 	for 	the 	specified
program 	year. 	Waitlisted applicants 	shall 	be
selected in order from lower- 	to higher-income
family 	units within each priority group.
799 . 1-28
363\ID-
§17-799.1-20
(f) 	Upon 	selection of an applicant 	from 	the
waitlist, 	the department 	shall 	then provide
notification of program enrollment as established
in 	section 	17-799.1-21.
(g) 	Waitlisted applicants 	selected for 	program
enrollment shall meet all 	eligibility requirements as
established 	in 	section 17-799.1-7.
(h) 	The waitlisted applicant shall 	not be
eligible 	for 	the 	initial 	payment until 	the 	later of:
(1) 	The month that 	requirement 	of 	section 17-
799.1-lO(b) 	is met; 	or
(2) 	The eligible 	child's 	first 	month at 	the
preschool that meets 	the 	requirements of
section 	17-799.1-11.
(i) 	If the 	waitlisted applicant 	is unable 	to
meet 	requirements 	of 	subsections 	(g) 	and 	(h), 	the
department will 	notify the 	applicant of 	the denial 	of
the 	application, 	and the 	department 	shall 	proceed to
the 	next available waitlist applicant pursuant 	to
subsection 	( e) .
(j) 	Assignment of applicants 	t~ th~ waitlist
shall be 	final 	and conclusive. 	[Eff MAY i 9 2026
(Auth: 	HRS §§346-14, 	346-181) 	(Imp: 	HRS §§346-14,
346-181)
§17 - 799.1 -20 	Denial, 	reduction, 	suspension, 	or
termination of child care payments. 	(a ) 	The
department may 	take 	adverse action 	to de ny, 	reduce,
suspend, 	or 	terminate 	child care paymen t s 	when 	the
conditions of 	this 	section apply:
(1) 	The applicant or 	family 	unit d o es 	not
complete 	the 	process 	of 	applying or
determination of 	eligibility within the
timeframe 	specified by the department's
notice pursuant 	to 	section 	17-799 . 1-2 1 , 	or
withdraws 	the 	application;
(2 ) 	The departm e nt 	receives 	the 	application
outside o f 	the application period 	f o r 	the
specified program year;
{3 ) 	The applicant or 	family 	unit d o es 	no t
sign, 	date, 	or 	submit a 	compl e ted
application 	form or 	report 	f o rm as
prescribed by the department;
799.1-29
"'
3 6 '3@ -
§17-799.1-20
(4) 	The applicant or 	family 	unit does 	not
submit 	verifying documentation requested
by the 	department;
(5) 	The child does 	not meet 	the 	eligibility
requirements 	referenced 	in subsection 	17-
799.1-7(b);
(6) 	The 	family 	unit does 	not meet the
eligibility 	requirements 	referenced 	in
subsection 17-799.1-7(e);
(7) 	Conditions 	initially present in the family
unit situation have 	changed and child care
is 	no longer 	needed;
(8) 	The 	family 	unit 	is 	unable to 	use child
care and another 	service must be
planned 	for;
(9) 	The 	preschool 	no 	longer meets 	the
accreditation requirements referenced in
section 17-799.1-12 	and child 	care
payments were previously calculated at
the 	higher rate 	for 	an 	accredited care
service;
(10) 	The 	family unit 	used unauthorized care
pursuant 	to 	section 	17-799.1-11;
(11) 	The 	family 	unit voluntarily requests
discontinuance of 	child 	care payments;
(12) 	The 	family 	unit 	fails 	to 	comply with
mandatory 	reporting 	requirements pursuant to
section 	17-799.1-17;
(13) 	The 	family 	unit 	is 	no 	longer eligible 	for
child care payments;
(14) 	The 	family 	unit cannot be located;
(15) 	The 	family 	unit 	fails 	to 	utilize child care
payments 	in accordance with subsection 	17-
799.1-4(c) 	and does 	not 	reconcile any
resulting overpayments 	in 	accordance 	with
section 17-799.1 - 23;
(16) 	The 	family 	unit 	fails 	to 	provide 	the
required eligibility documentation
pursuant 	to 	17-799.1-7(h), 	and two months
have passed from 	the 	first 	calendar day
of 	the 	initial month 	of presumptive
eligibility 	for 	the 	family 	unit;
(17) 	The 	family 	unit does 	not 	complete 	the 	report
form 	for 	continued eligibility within the
799.1-30
§17-799.1-21
(18)
{b)
when:
( 1)
{ 2)
timeframe 	specified by 	the department's
notice pursuant 	to section 17-799.1-21; 	or
The department determines pursuant to
section 17-799.1-24 	that 	there are
insufficient 	funds 	to maintain all 	children
receiving 	care.
The department may 	suspend child care payments
The designated preschool 	does 	not meet program
qualification 	requirements 	referenced 	in
section 	17-799.1-11 	and 	the 	family 	unit must
find a 	different 	approved preschool;
The 	child has 	absences 	that are unexcused
for more 	than 	five 	consecutive days
(3) 	The 	family unit 	fails 	to 	comply with
requirements 	referenced 	in 	subsection 	17-
799.1-lO(b);
(4) 	The payment amount 	is 	determined to be
zero; 	or
(5) 	A natural disaster or emergency is 	declared
by 	the 	federal, 	state, 	or county government.
[Eff MAY 2 9 2026 	] 	(Auth: 	HRS §§346-14,
346-181) 	{Imp: 	HRS §§346-14, 	346-181)
§17-799.1-21 	Notices. 	(a} 	The department 	shall
provide a 	written notice 	to applicants and 	recipients
about 	their eligibility status 	that 	shall 	contain:
(1) 	A statement of 	the action taken;
(2) 	The reasons 	for 	the action;
(3) 	The specific rules 	supporting 	the action;
and
(4) 	The 	right 	to appeal 	the 	action of the
department through 	established
administrative appeals procedures, 	when
applicable.
{b) 	Applicants 	that 	are placed on a 	waitlist
shall be provided written notification of 	this
designation, 	and a 	separate notice 	if they are
selected from the waitlist 	to enroll 	into the program.
(c) 	The department shall provide a 	caretaker
with timely and adequate 	notice prior 	to 	taking
adverse action to deny, 	reduce, 	suspend, 	or terminate
any child care 	payments 	specified in 	this 	chapter.
799.1-31
3 6 3@ -
§17-799.1-21
(d) 	A caretaker 	can submit verifying
documentation 	for consideration by the department 	to
reverse 	the proposed department 	action prior 	to 	the
effective date of the 	action.
(e) 	Only adequate notice 	is required when the
following
(1)
(2)
(3)
{ 4)
( 5)
(6)
(7)
occurs:
A caretaker 	is deceased;
A caretaker 	left the 	State;
A caretaker 	requests discontinuance of child
care payments;
A caretaker 	fails 	to comply with mandatory
reporting 	requirements;
A caretaker's whereabouts are unknown;
A caretaker 	receives 	an 	increase in 	the
amount of monthly child care payments; 	or
The department determines pursuant 	to
section 	17-799.1-24 	that 	there are
insufficient 	funds 	to maintain all children
receiving 	care. 	[ Eff MAY 2 9 2026 	]
(Auth: 	HRS §§346-14, 	346-181) 	(Imp: 	HRS
§§346-14, 	346-181)
§17-799.1-22 	Administrative appeal requests.
(a) 	A caretaker may 	fil e 	a 	written 	request 	for 	an
administrative appeal, 	i n 	accordance with the
provisions 	set 	forth 	in c hapter 17-602.1, 	when 	the
family 	unit disagrees 	with 	the department's 	adverse
action to deny, 	reduce, 	suspend, 	or terminate payment,
or with the department's 	determination of an
overpayment, 	except 	in the 	case of 	sections 	17-799.1-
19 and 17-799.1-20{a ) (18).
(b) 	Child c are payments 	shall 	nQt continue
during 	the appeal process. 	[Eff 	MAY Z 9 2026 	J
(Auth: 	HRS §§346 - 14, 	346-181) 	(Imp: 	HRS §§346-14,
346-181)
§17-799.1-23 	Underpayments and overpayments.
(a) 	Underpayments 	shall 	be 	processed as 	follows:
(1) 	Prompt action shall be taken to correct any
underpayment 	to a 	currently eligible
caretaker who would have 	received a 	greater
799.1-32
§17-799.1-23
payment 	if an 	error by 	the department 	had
not occurred.
(2) 	If a 	caretaker has 	both an overpayment and
an underpayment, 	the overpayment and
underpayment 	shall be offset one against the
other 	in 	correcting 	the payment.
(b) 	Overpayments 	shall 	be processed as 	follows:
(1) 	Failure 	to provide 	information, 	as 	specified
in 	sections 	17-799.1-6, 	17-799.1-7, 	17-
799.1-16, 	17-799.1-17, 	and 17-799.1-19, 	or
errors made by the department may affect the
caretaker's 	eligibility and 	result 	in an
overpayment.
(2) 	An overpayment made to a 	caretaker shall be
recovered 	through:
(A) 	Repayment 	in cash, 	in 	full 	or 	in
part, 	by the 	caretaker to the
department; 	or
(Bl 	A reduction of not 	less 	than 	ten
percent 	in 	the child care payment
amount payable 	to the 	caretaker 	in
subsequent months 	until 	the entire
amount of overpayment is recovered,
provided the caretaker c ontinues 	to
receive 	such payments.
(3) 	A caretaker subject 	to recovery of an
overpayment shall be provided adequate
notice by 	the department 	including:
(A) 	The 	reasons, 	dates, 	and the amount of
the 	alleged overpayment; 	and
(B) 	The proposed method by which the
overpayment 	shall be 	recovered.
(4) 	Recovery of an overpayment 	to 	former
recipients 	of child care payments shall 	be
referred to 	the department's 	fiscal
management office 	for 	collection action .
(5) 	If a 	caretaker 	for whom a 	collection action
has 	been 	initiated fails 	to make 	a 	payment
for 	any month in 	the calendar tax year, 	the
department may 	refer debts exceeding
twenty-five 	dollars 	to the comptroller of
the 	State 	for 	tax 	setoMAl! 9
sfrf2~ified in
chapter 17-606. 	[Eff 	]
(Auth: 	HRS 	§§346-14, 	346-44, 	346-181)
(Imp: 	HRS §§346 - 35, 	346 - 44, 	346 - 181)
799.1-33
§17-799.1-24
§17-799.1-24 Termination for 	insufficient funds.
(a) 	When 	there are 	insufficient 	funds 	to pay 	child
care payments at 	current amounts 	through the 	end of
the 	State 	fiscal 	year, 	the department may, 	at 	its
discretion, 	refuse 	to 	take 	new applications 	during 	the
application period, 	refuse 	to enroll 	applicants 	who
have been waitlisted, 	reduce 	payments, 	or 	terminate
payments.
(b) 	During the application period, 	reducing
payments 	or 	terminating payments will 	be 	accomplished
in 	reverse chronological 	order from the date 	the
application was 	received by 	the 	department, 	and 	if
there are not enough 	funds 	for 	all 	family 	units, 	then
the 	department will 	further 	determine priority groups
in the 	following 	order:
(1) 	Children who are 	two years 	old by July 	31
of the 	specified program year;
(2) 	Children who are 	three 	years 	old by 	July 	31
of the 	specified program year; 	and
(3) 	Children who are 	eligible to enter
kindergarten by 	the end of 	the 	specified
program year.
Family units 	shall 	be 	income-ranked from 	highest 	to
lowest 	within their 	priority group, 	by dividing 	their
monthly gross 	income by 	five 	hundred per cent 	of 	the
Federal 	Poverty Guidelines 	in effect 	for 	the 	specified
program year 	for 	a 	family of the 	same 	size, 	as 	updated
for 	the 	specified program year. 	Payments 	shall 	be
reduced or 	terminated in 	order 	from higher- 	to 	lower-
income 	family 	units 	within each priority group.
(c) 	The department budget will be managed by
reviewing monthly expenditures and evaluating whether
the cumulative expenditures 	at 	the end of any given
month are 	less than 	or equal 	to the 	number of months
that have 	expired in 	the 	fiscal 	year 	times 	1/12 	of 	the
budget 	appropriation 	for 	child care 	payments 	for 	the
State 	fiscal 	year .
(d) 	When 	the 	department determines 	that the 	budget
appropriation has or 	soon will be exceeded, 	notices of
adverse 	action may be 	issued to limit the 	number of
children 	receiving payments 	in any given month or 	to
take other necessary action to operate within the 	child
799.1-34
§17-799.1-24
care budget appropriation and available 	funds . 	A
decision under 	this 	subsection shall be 	final 	and
conclusive. 	[Eff 	MAY 2 9 2026 	] 	( Auth: 	HRS §§346-14,
346-181) 	(Imp: 	HRS §§346-14, 	346-181)
7 99 . 1- 35
Per Cent of FPG
Co-Payment
Child Care
Co-Payment Sliding Fee Scale
0-3 00% 	301-400%
1% 	2%
co-pay 	co-pay
401-500%
3%
co-pay
Federal Poverty Guidelines (FPG), based on household size, will be updated annually on February 1
for the upcoming specified program year.
Source: https: //aspe.hhs.gov/topicslpoverty-economic•mobility/poverty-guidelines
Department of Human Services
Benefit, Employment and Support Services Division
February 27, 2026
Exhibit 	I
"41
3630-. •
Per Cent of FPG 	0-185%
0%
Co-Payment co-pay
Child Care
Co-payment Sliding Fee Scale
186-300%
1%
co-pay
301-400% 	401-500%
2% 	3%
co-pay 	co-pay
Federal Poverty Guidelines (FPG), based on household size, will be updated annually on February I
for the upcoming specified program year.
Source: https: //aspe.hhs.gov/topics/poverty•economic-mobility/poverty-guidelines
Department of Human Services
Benefit, Employment and Support Services Division
February 27, 2026
EXHIBIT 	II
3 63 O -

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