Office of Children and Family Services

Life Safety and Fiscal Issues Related to Legally Exempt Child Care

Child care providers in New York State are licensed, registered and regulated by 58 local social services districts (57 counties and New York City) under the supervision of the Office of Children and Family Services (OCFS). Child care costs incurred by low-income families may be eligible for annual subsidies provided through the local districts and OCFS. Close to 40 percent of the children covered by such subsidies receive legally exempt child care, which typically consists of care for one or two children at the providerís home. While legally exempt child care providers are expected to meet certain health and safety requirements, they are not subject to the same level of oversight as the larger licensed and registered child care providers.

We visited 70 legally exempt child care providers in three local districts (Albany, Monroe and Nassau Counties) to determine whether the services subsidized through the districts and OCFS were actually being provided. In 31 of the 70 visits, we were unable to confirm that child care services were being provided. In all 31 cases, local district officials who accompanied us on the visits took immediate action to discontinue or adjust the subsidies, and initiated investigations to determine whether subsidy payments to the providers and parents had been fraudulent. We also determined that the safety of some children could be at risk, as some of the legally-exempt providers we tested may have had criminal histories or been the subjects of investigations into child abuse or maltreatment. We also observed potentially dangerous conditions at the sites of some providers, such as uncapped syringes and sharp objects (a knife and a razor) that were accessible to children. We recommended that a number of changes be made in the oversight provided to legally exempt child care providers.

For a complete copy of Report 2002-S-38 click here.
For a copy of the 90-day response click here.