A. The department shall establish payment rates for child care assistance. Payment rates shall provide for equal access for eligible families to comparable child care services provided to families who are not eligible to receive child care assistance.

B. Payment rates shall be identical in form for all child care assistance.

C. The department may pay different levels of child care assistance according to the category of child care provider, age of children, geographic area, level of national accreditation or another state-approved quality indicator, varying child care costs for children with special needs or other circumstances to meet the child care needs of eligible families.

D. Each federal fiscal year, the department shall pay at least thirty-three percent of quality set-aside monies for tiered reimbursement of child care providers that meet the quality standard.

E. The department shall establish a sliding fee scale and formula for determining child care assistance based on:

1. Income and earnings of the family.

2. Family size.

3. Number of children receiving child care assistance.

4. Child support to other minor dependent children of the parent living outside the family unit.

5. Income and earnings of a family member who is at least eighteen years of age and who is residing in the home with a parent who is receiving child care assistance, if the family member claims any member of a family unit applying for assistance as a dependent on a federal or state income tax return.

6. Income and earnings of a nonfamily member who is at least eighteen years of age and who is residing in the home of and cohabiting with a parent who is receiving child care assistance if the cohabiting nonfamily member claims any member of a family unit applying for assistance as a dependent on a federal or state income tax return.

7. Other factors of a similar nature.

F. The department shall annually review and adjust the sliding fee scale and formula for determining child care assistance pursuant to subsection D of this section and section 46-803.

G. The department shall post on the department’s website the payment rates and the most current sliding fee scale and formula for determining child care assistance established pursuant to this section.

H. All child care providers shall remain in good standing with licensing and certification laws and adopted rules.

I. For the purposes of this section:

1. "Quality set-aside monies" means the total amount of federal child care and development fund monies that must be used for activities that do one or more of the following:

(a) Improve the quality of child care services.

(b) Increase parental options for and access to high quality child care.

(c) Relate to the quality of care for infants and toddlers.

2. "Quality standard" means accreditation from a national organization or a state-approved quality indicator that is recognized by the department.

3. "Tiered reimbursement" means a child care assistance system that is offered by the department and that provides higher payments for child care services that meet higher quality standards.