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Statement of Need: The Administration for Children and Families will issue rules to amend 45 CFR chapter XIII by adding a new part 1307, Policies and Procedures for Designation Renewal of Head Start and Early Head Start Grantees, in order to respond to the statutory requirements of The Improving Head Start for School Readiness Act of 2007, which establishes that Head Start grantees will be awarded grants for a 5-year period and only grantees delivering high quality services will be given another 5-year grant non-competitively. These regulations will describe the proposed system for designation renewal, including a proposal to transition all current continuous grants into 5-year grants over a 3-year period. These regulations will encourage excellence, establish accountability for poor performance, and open up Head Start to new energetic organizations that may have great capacity to run high quality programs.

Summary of the Legal Basis: Section 641 of the Head Start Act requires the Secretary of HHS to develop and implement a system for designation renewal (e.g., Designation Renewal System (DRS)) to determine if a Head Start agency is delivering a high-quality and comprehensive Head Start program that meets the educational, health, nutritional, and social needs of the children and families it serves and publish a notice in the Federal Register describing a proposed system for designation renewal, including a proposal for the transition to such system.

Alternatives: The Administration for Children and Families is statutorily mandated to develop and implement a system for designation renewal. As a precursor to developing the system, the Head Start Act required the Secretary to establish an Advisory Committee to inform the development of a DRS and make recommendations to the Secretary. We are proposing to adopt the majority of the Advisory Committee’s recommendations in whole or with minor modifications. In addition, we are considering additional and alternative criteria to be incorporated into the system for designation renewal, and ask for public comments regarding numerous provisions of the rule, as described in the preamble.

Anticipated Costs and Benefits: The Agency estimates the costs of implementing the new reporting requirements described in the rule will be approximately $20,000 annually. In addition, at least 25 percent of grantees reviewed in a year will be required to submit a competitive application for a new 5-year grant, at an estimated cost of less than $1,500 for each grantee. In terms of benefits, the proposed system will fund only high-performing grantees in order to ensure the best services for Head Start children are provided and child outcomes are improved.