Overview of Alternative Payment Programs and Community-Based Organizations in CaliforniaHistory In 1976, Governor Brown’s office set forth a pilot program to expand the growth of child development programs in the state. The outcome of that pilot program was legislation in 1980 to create Alternative Payment (AP) child care programs in each of California’s 58 counties. The purpose of these programs was to allow innovative community based public and private agencies to develop non-traditional regional approaches that would support parental choice of access for children from birth on to a variety of early care and education settings. Today, there are 70 Alternative Payment Programs (APPs) that administer California’s subsidized child care programs across all 58 counties. The focus of these programs are to support working families and those on the California Work Opportunity and Responsibility to Kids (CalWORKs) program with access to a variety of early care and education settings, including high quality Title 5 centers, Family Child Care Home Education Networks (FCCHENs), family child care providers, and small business child care and early learning providers. Children Served and Unmet Need 261,764 Children supported by our CBOs in 2025-26
390,714 Children 0-13 in subsidized child care outside of the public schools
1.8M Income-eligible children unable to access child care in 2024
In 2025-26, our CBOs supported 161,332 children in the Alternative Payment Program, 52,356 children in CalWORKs Stage 2, and 48,076 children in CalWORKs Stage 3 for a total of 261,764 children ages 0 to 13. The total number of children from 0-13 served in subsidized child care outside of the public schools is 390,714. The state has also committed to adding 200,000 new child care slots by 2027-28. Currently, of the 200,000 promised, roughly 150,000 have been funded with about 50,000 remaining.1 The California Budget and Policy Center estimates that 1.8 million income-eligible children were unable to access child care in 2024. As California’s child poverty rate has climbed to 18.9% since 2019, the gap between families’ need for care and access to subsidized services remains unacceptably large. About Alternative Payment ProgramsWhat is an Alternative Payment Program (APP)?Alternative Payment Programs (APPs) are community-based organizations that provide a safety net of services and serve as a “one-stop” shop for families eligible for subsidized child care. These public and private nonprofit organizations may offer a variety of child care arrangements for parents to choose from, including in-home care, family child care, and center-based care for children beginning at birth. The AP program supports parental choice and accommodates the individual cultural and linguistic needs of the family and children. APPs have evolved to offer additional services that will help families achieve economic self-sufficiency, including: Food access Housing Medical care Mental health Home visiting Transportation Legal assistance Translation services and more Who do APPs serve?Low-income working families who are eligible for CalWORKs Stages 1, 2 and 3 child care, as well as working non-CalWORKs families who meet specific income thresholds via the AP child care program. How long do families stay with an APP?3.4 to 5.2 years Core functions of an APPEnrollment & Payment Determine family eligibility and enroll families in subsidized child care programs Verify hours of care provided Make payments to child care providers chosen by the family Process vouchers for counties that opt in to the foster care bridge program Parent & Provider Support Educate parents about provider types and setting options for children from birth on Provide parents with community support information Offer access to toy closets and resource libraries for parents and providers Community Connection Link families directly to programs and services within their community Serve as a community resource hub during times of declared emergencies Other contracts delivered by APPsCalWORKs Stages 2 & 3 Preschool and center based programs General child care Child and Adult Care Food Program (CACFP) Family Child Care Home Education Networks (FCCHEN) Transportation Behavioral health Respite Regional center Health and safety 21st Century Trustline Additionally, roughly 40 counties contract out administration of CalWORKs Stage 1 child care to their local APP agency; this represents roughly 94 percent of the caseload. About Thriving Families CA FoundationThriving Families CA Foundation (TFC) is a 47-year network of community-based public and private nonprofit agencies that support working families and children. Established in 1977, TFC is the lead voice for public and private nonprofit agencies who contract with California Department of Social Services (CDSS) to provide child care subsidies to families and to ensure children keep learning while parents are earning. Who funds TFC? Funding comes from member agencies, affiliate members and donations. How TFC helpsEconomic self-sufficiencyHelping parents pay for the child care they need to work, look for work, or attend a training program. School readinessProviding children with access to quality child care and development programs. Consumer responsibilityAllowing parents to choose the child care program or programs that best meet their needs. Continuity of servicesServing children from infancy through the school age years. Employment optionsAccommodating non-traditional work schedules and the changing child care needs of families. Family servicesFacilitating access to family service programs. Parent educationProviding parent education and important health and safety information. Notes 1Before 2026-27, roughly 129,800 of the 200,000 slots had been funded. The 2026-27 Budget Act adds 22,770 new slots (20,700 California Alternative Payment Program slots beginning October 1, 2026, and 2,070 General Child Care slots beginning April 1, 2027), offset by a federal funding reduction that eliminates 4,330 Alternative Payment slots, for a net increase of 18,440 slots. Children Now, “How the Proposed 2026-27 State Budget Impacts Kids,” January 29, 2026; Legislative Analyst’s Office, “The 2026-27 California Spending Plan: Child Care and State Preschool,” September 30, 2026. |