IOUs for Child Care Providers?

California State Controller John Chiang's office began issuing IOUs on July 2, 2009, to pay the various businesses, big and small, that contract with the state.

The IOUs have an interest rate of 3.75% and a maturity date of October 1, which assumes that California will have a state budget in place by then.

Chiang's office has also compiled a list of programs and agencies that will receive IOUs in lieu of cash payments as well as a list of those that will continue to receive their regular cash payments for the foreseeable future.

The California Department of Social Services (CDSS), which administers that portion of the CalWORKS program known as stage 1 that provides temporary cash assistance for basic family needs and issues specific welfare-to-work requirements, is on the list of agencies to receive IOUs.

Educational institutions, however, will continue to receive their monthly budgetary allotments, since funding for K-12, community, colleges, and public universities are constitutionally mandated.

This includes the California Department of Education (CDE), which administers that portion of CalWORKS known as stage 2 and stage 3 that provides child care subsidies to low-income families and individuals.

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