Enact the Child Care Fraud Prevention Act

As Introduced

136th
General Assembly

Regular
Session
H. B. No. 649

2025-2026

Representatives Williams, Swearingen

Cosponsors: Representatives Kishman,
Miller, M., Hall, T., Willis, Thomas, D., Hiner, Miller, K., Workman,
Click, Holmes, Odioso, Johnson, Ritter, Barhorst, Salvo, Lear,
Schmidt, Deeter, Fischer, King, Santucci, Plummer, Creech, Gross,
McClain, Stephens

To
amend sections 5104.015 and 5104.04 and to enact sections 5104.044,
5104.303, 5104.304, and 5104.361 of the Revised Code
to
require video surveillance of child care centers, to establish an
online portal for tracking child care center attendance, to require
investigations of waste, fraud, and abuse allegations relating to
providers of publicly funded child care, and to name this act the
Child Care Fraud Prevention Act.

BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section
1.
That
sections 5104.015 and 5104.04 be amended and sections 5104.044,
5104.303, 5104.304, and 5104.361 of the Revised Code be enacted to
read as follows:

Sec.
5104.015.
The
director of children and youth shall adopt rules in accordance with
Chapter 119. of the Revised Code governing the operation of child
care centers, including parent cooperative centers, part-time
centers, and drop-in centers. The rules shall reflect the various
forms of child care and the needs of children receiving child care or
publicly funded child care and shall include specific rules for
school-age child care centers that are developed in consultation with
the department of education and workforce. The rules shall include
the following:

(A)
Submission of a site plan and descriptive plan of operation to
demonstrate how the center proposes to meet the requirements of this
chapter and rules adopted pursuant to this chapter for the initial
license application;

(B)
Standards for ensuring that the physical surroundings of the center
are safe and sanitary including the physical environment, the
physical plant, and the equipment of the center;

(C)
Standards for the supervision, care, and discipline of children
receiving child care or publicly funded child care in the center;

(D)
Standards for a program of activities, and for play equipment,
materials, and supplies, to enhance the development of each child;
however, any educational curricula, philosophies, and methodologies
that are developmentally appropriate and that enhance the social,
emotional, intellectual, and physical development of each child shall
be permissible. As used in this division, "program" does
not include instruction in religious or moral doctrines, beliefs, or
values that is conducted at child care centers owned and operated by
churches and does include methods of disciplining children at child
care centers.

(E)
Admissions policies and procedures;

(F)
Health care policies and procedures, including procedures for the
isolation of children with communicable diseases;

(G)
First aid and emergency procedures;

(H)
Procedures for discipline and supervision of children;

(I)
Standards for the provision of nutritious meals and snacks;

(J)
Procedures for screening children that may include any necessary
physical examinations and shall include immunizations in accordance
with section 5104.014 of the Revised Code;

(K)
Procedures for screening employees that may include any necessary
physical examinations and immunizations;

(L)
Methods for encouraging parental participation in the center and
methods for ensuring that the rights of children, parents, and
employees are protected and that responsibilities of parents and
employees are met;

(M)
Procedures for ensuring the safety and adequate supervision of
children traveling off the premises of the center while under the
care of a center employee;

(N)
Procedures for record keeping, organization, and administration;

(O)
Procedures for issuing, denying, and revoking a license that are not
otherwise provided for in Chapter 119. of the Revised Code;

(P)
Inspection procedures;

(Q)
Procedures and standards for setting initial license application
fees;

(R)
Procedures for receiving, recording, and responding to complaints
about centers;

(S)
Procedures for enforcing
section

sections

5104.04

and
5104.044
of
the Revised Code;

(T)
Minimum qualifications for employment as an administrator or child
care staff member, which shall not include requiring an administrator
or child care staff member to hold or obtain a bachelor's, master's,
or doctoral degree;

(U)
Requirements for the training of administrators and child care staff
members, including training in first aid, in prevention, recognition,
and management of communicable diseases, and in child abuse
recognition and prevention;

(V)
Standards providing for the needs of children who have disabilities
or who require treatment for health conditions while the child is
receiving child care or publicly funded child care in the center;

(W)
A procedure for reporting of injuries of children that occur at the
center;

(X)
Standards for licensing child care centers for children with
short-term illnesses and other temporary medical conditions;

(Y)
Minimum requirements for instructional time for child care centers
rated through the step up to quality program established pursuant to
section 5104.29 of the Revised Code;

(Z)
Any other procedures and standards necessary to carry out the
provisions of this chapter regarding child care centers.

Sec.
5104.04.
(A)
The department of children and youth shall establish procedures to be
followed in investigating, inspecting, and licensing child care
centers, type A family child care homes, and licensed type B family
child care homes.

(B)(1)(a)
The department shall, at least once during every twelve-month period
of operation of a center, type A home, or licensed type B home,
inspect the center, type A home, or licensed type B home. The
department shall inspect a part-time center or part-time type A home
at least once during every twelve-month period of operation. The
department shall provide a written inspection report to the licensee
within a reasonable time after each inspection.

Inspections
may be unannounced. No person, firm, organization, institution, or
agency shall interfere with the inspection of a center, type A home,
or licensed type B home by any state or local official engaged in
performing duties required of the state or local official by this
chapter or rules adopted pursuant to this chapter, including
inspecting the center, type A home, or licensed type B home,
reviewing records, or interviewing licensees, employees, children, or
parents.

(b)
Upon receipt of any complaint that a center, type A home or licensed
type B home is out of compliance with the requirements of this
chapter or rules adopted pursuant to this chapter, the department
shall investigate the center or home, and both of the following
apply:

(i)
If the complaint alleges that a child suffered physical harm while
receiving child care at the center or home or that the noncompliance
alleged in the complaint involved, resulted in, or poses a
substantial risk of physical harm to a child receiving child care at
the center or home, the department shall inspect the center or home.

(ii)
If division (B)(1)(b)(i) of this section does not apply regarding the
complaint, the department may inspect the center or home.

(c)
Division (B)(1)(b) of this section does not limit, restrict, or
negate any duty of the department to inspect a center, type A home,
or licensed type B home that otherwise is imposed under this section,

or

any
authority of the department to inspect a center, type A home, or
licensed type B home that otherwise is granted under this section
,
or any authority of the department to inspect a center that otherwise
is granted under section 5104.044 of the Revised Code
.

(2)
If the department implements an instrument-based program monitoring
information system, it may use an indicator checklist to comply with
division (B)(1) of this section.

(C)
The department may deny an application or revoke a license of a
center, type A home, or licensed type B home, if the applicant
knowingly submits falsified information to the department or if the
center or home does not comply with the requirements of this chapter
or rules adopted pursuant to this chapter.

(D)
If the department finds, after notice and hearing pursuant to Chapter
119. of the Revised Code, that any applicant, person, firm,
organization, institution, or agency applying for licensure or
licensed under section 5104.03 of the Revised Code is in violation of
any provision of this chapter or rules adopted pursuant to this
chapter, the department may issue an order of denial to the applicant
or an order of revocation to the center, type A home, or licensed
type B home revoking the license previously issued by the department.
Upon the issuance of such an order, the person whose application is
denied or whose license is revoked may appeal in accordance with
section 119.12 of the Revised Code.

(E)
The surrender of a center, type A home, or licensed type B home
license to the department or the withdrawal of an application for
licensure by the owner or administrator of the center, type A home,
or licensed type B home shall not prohibit the department from
instituting any of the actions set forth in this section.

(F)
Whenever the department receives a complaint, is advised, or
otherwise has any reason to believe that a center or type A home is
providing child care without a license issued pursuant to section
5104.03 and is not exempt from licensing pursuant to section 5104.02
of the Revised Code, the department shall investigate the center or
type A home and may inspect the areas children have access to or
areas necessary for the care of children in the center or type A home
during suspected hours of operation to determine whether the center
or type A home is subject to the requirements of this chapter or
rules adopted pursuant to this chapter.

(G)
The department, upon determining that the center or type A home is
operating without a license, shall notify the attorney general, the
prosecuting attorney of the county in which the center or type A home
is located, or the city attorney, village solicitor, or other chief
legal officer of the municipal corporation in which the center or
type A home is located, that the center or type A home is operating
without a license. Upon receipt of the notification, the attorney
general, prosecuting attorney, city attorney, village solicitor, or
other chief legal officer of a municipal corporation shall file a
complaint in the court of common pleas of the county in which the
center or type A home is located requesting that the court grant an
order enjoining the owner from operating the center or type A home in
violation of section 5104.02 of the Revised Code. The court shall
grant such injunctive relief upon a showing that the respondent named
in the complaint is operating a center or type A home and is doing so
without a license.

(H)
The department shall prepare an annual report on inspections
conducted under this section

and section 5104.044 of the Revised Code
.
The report shall include the number of inspections conducted, the
number and types of violations found, and the steps taken to address
the violations. The department shall file the report with the
governor, the president and minority leader of the senate, and the
speaker and minority leader of the house of representatives on or
before the first day of January of each year, beginning in 1999.

(I)
While an investigation conducted by the department under this section
remains ongoing, any of its investigative records are not public
records for purposes of section 149.43 of the Revised Code.

Sec.
5104.044.
(A)
To the extent permitted by federal law, all of the following apply to
each child care center:

(1)
The center shall procure and maintain a camera, collection of
cameras, or camera system at every entrance to and exit from the
center. At each entrance and exit where such a camera, collection, or
system is maintained, the camera, collection, or system shall have a
clear line of sight to both the interior and exterior of that
entrance and exit.

(2)
The center shall procure and maintain a camera, collection of
cameras, or camera system in the general areas of the center where
children receive child care, except that this requirement does not
apply to any of the following areas of the center: its administrative
areas, including offices, and any private areas, including changing
rooms and restrooms.

(3)
Each camera, collection, or system described in divisions (A)(1) and
(2) of this section shall record for each day that the center
operates and shall be capable of storing either on the center's site
or digitally the video from each day of operation for the sixty-day
period immediately following the recording of the day of operation.

(4)
To enable the department of children and youth, under its authority
described in division (B)(1)(a) of section 5104.04 of the Revised
Code, to conduct unannounced inspections, including visual
inspections relating to attendance, other administrative matters, and
health and safety concerns, the center shall provide the department
on the department's request access to every camera, collection, or
system described in divisions (A)(1) to (3) of this section, with
such access to include the video stored as described in division
(A)(3) of this section.

(B)
Not later than twelve months after the effective date of this section
and to the extent permitted by federal law, all of the following
apply:

(1)
To enable the department, under its authority described in division
(B)(1)(a) of section 5104.04 of the Revised Code, to conduct
unannounced inspections, including visual inspections relating to
attendance, other administrative matters, and health and safety
concerns, each child care center shall provide the department on the
department's request access to every camera, collection, or system
described in division (A) of this section, with such access after
that date to include both live access, as well as the video stored
and provided under divisions (A)(3) and (4) of this section.

(2)
The department shall develop and implement a system capable of
surveilling the live and stored video provided by each center under
this section.

(3)
The department shall surveil and use the live and stored video to
conduct visual attendance audits of child care centers. Such audits
shall be logged into the department's system by noting the date,
time, location, and individual who conducted the visual attendance
audit. The department also shall surveil and use the live and stored
video for any other lawful purpose, including to monitor the health
and safety of the children receiving child care at the center and to
conduct any other administrative matter.

(C)(1)
The department shall immediately suspend or withhold any further
state payments to any child care center if an inspection or audit
conducted under this section indicates that the center has engaged in
probable or suspected waste, fraud, and abuse, false attendance
reporting, or other material misrepresentation, pending a full
investigation and adjudication by the department.

(2)
If a child care center fails to comply with the requirements of this
section, the department may terminate the center's contract entered
into under section 5104.32 of the Revised Code to provide publicly
funded child care.

(D)
The video described in this section, including both live access video
and stored video, is not a public record for purposes of section
149.43 of the Revised Code.

Sec.
5104.303.
(A)
Immediately after receiving an allegation of probable or suspected
waste, fraud, and abuse related to a provider of publicly funded
child care that is a child care center, the department of children
and youth shall conduct a preliminary investigation of the
allegation. If, as part of the investigation, the department
determines that the allegation is substantiated and the director of
children and youth reasonably believes that the provider engaged in
probable or suspected waste, fraud, and abuse, including false
attendance reporting, or made material misrepresentations to the
department, then not later than forty-eight hours after that
determination and belief have been reached, the department of
children and youth shall refer the matter to the auditor of state. As
soon as practicable after receiving the referral, the auditor of
state shall conduct a full investigation of the allegation in
accordance with Chapter 117. of the Revised Code.

(B)
At the beginning of the investigation described in division (A) of
this section, the auditor shall report to the speaker of the house of
representatives and president of the senate that the auditor received
a referral seeking a full investigation of a provider of publicly
funded child care. At the conclusion of the required investigation,
the auditor shall provide to the speaker of the house of
representatives and senate president a summary of the investigation,
with the summary to indicate whether or not the name of the provider
under investigation has been referred to the office of attorney
general for prosecution as described in division (C) of this section.

(C)
When a full investigation conducted by the auditor demonstrates that
a provider of publicly funded child care that is a child care center
engaged in probable or suspected waste, fraud, and abuse or made
material misrepresentations to the department of children and youth,
the auditor shall refer the matter to the office of the attorney
general.

(D)
While an investigation conducted under this section remains ongoing,
any of its investigative records are not public records for purposes
of section 149.43 of the Revised Code.

Sec.
5104.304.
(A)
On a referral from the auditor of state described in section 5104.303
of the Revised Code, the attorney general may in the name of this
state institute against the provider of publicly funded child care in
a court of competent jurisdiction appropriate legal action, including
criminal prosecution.

(B)
In any other instance of probable or suspected waste, fraud, and
abuse relating to the publicly funded child care program of which the
department of children and youth becomes aware, the department of
children and youth may request that the attorney general institute in
the name of this state in a court of competent jurisdiction
appropriate legal action, including criminal prosecution, against the
person or governmental entity engaging in the probable or suspected
waste, fraud, and abuse. On the department's request, the attorney
general may institute such an action.

Sec.
5104.361.
(A)
Not later than twelve months after the effective date of this section
and to the extent permitted by federal law, the department of
children and youth shall establish and make available an online
portal for the purpose of tracking child care center attendance
through the automated child care system described in section 5104.32
of the Revised Code. The portal shall allow a caretaker parent of a
child enrolled with a child care center to record the child's
attendance upon the child's entry to and exit from the center.

(B)
In making available the online portal and recording attendance
through it, all of the following apply:

(1)
The department shall provide each child care center with appropriate
software through which a child's caretaker parent shall record the
child's attendance, with such software serving as the only method by
which attendance is recorded through the portal.

(2)
The child's caretaker parent shall be responsible for recording the
child's attendance upon the child's entry to and exit from the child
care center for each day the child attends the center. Such a record
shall be completed only at the center or another location where the
center is approved to provide child care to the child.

(3)
The online portal shall close at eleven fifty-nine p.m. each day,
except that, in the case of a child care center providing child care
during nontraditional hours, the timeline may be adjusted with the
approval of the department.

(4)
The portal shall not permit a caretaker parent or child care center
to backdate a child's attendance.

(5)
The portal shall allow for the use of pins or quick response codes
when recording attendance, with the pin or code uploaded each day
attendance is recorded. If a caretaker parent uses a quick response
code, the parent shall allow location data from the parent's
registered cellular phone to be collected at the time of the code's
use.

(6)
Each attendance record submitted through the portal shall include a
photograph with a clear picture of the face of the child's caretaker
parent. If the record does not include such a picture, the department
shall reject the record.

(C)
The department shall use attendance records submitted through the
online portal under this section when calculating a child care
center's payments for publicly funded child care as described in
division (C)(1) of section 5104.32 of the Revised Code. Records
submitted to the department through the online portal are
confidential and may be used by the department only as described in
this division.

Section
2.
That
existing sections 5104.015 and 5104.04 of the Revised Code are hereby
repealed.

Section
3.
This
act shall be known as the Child Care Fraud Prevention Act.