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HB 5723

Children: child care; provider advisory council; establish. Amends 1973 PA 116 (MCL 722.111 - 722.128) by adding sec. 16a.

2025-2026 Regular Session Introduced by Kelly Breen and 6 co-sponsors

The bill creates a Provider Advisory Council to pre-review and formally recommend on contracts, RFPs, and funding with child care providers, boosting transparency and ethics.

referred to second reading
#children:childcare #stateagencies(existing):healthandhumanservices
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Bill Summary · HB 5723

Summary of HB 5723 (Michigan, 2025-2026)

Purpose and intent

HB 5723 adds a new Sec. 16a to 1973 PA 116 (child care licensing and regulation) to establish a Provider Advisory Council within the department responsible for child care. The council is tasked with providing formal review and input on department contracts, requests for proposals, and funding decisions related to child caring institutions and child placing agencies. The bill emphasizes transparency, conflict-of-interest management, and structured, timely consultation before contracts are finalized.

Key provisions

  • Establishment and membership (Sec. 16a(1)-(2))

    • The department must establish the Provider Advisory Council within 90 days of the act’s effective date.
    • Council size: 7 to 11 members.
    • Composition: individuals employed by Michigan-headquartered child caring institutions or child placing agencies with at least 5 consecutive years in-state. At least one member must come from an industry-recognized statewide professional association serving children and families, who serves as a nonvoting member.
    • Appointment: the department nominates candidates (in consultation with at least one statewide professional association) via a publicly noticed application process; the department’s director appoints council members.
    • Geographic representation: members must reflect different regions of the state.

  • Term, meetings, and duties (Sec. 16a(3))

    • Terms: 3 years, with possible reappointment.
    • Meetings: at least quarterly; special meetings may be convened as needed.
    • duties:
    • Review proposed initial contracts, renewals, or material amendments to contracts with child caring institutions or child placing agencies.
    • Review department-issued requests for proposals (RFPs) and notices of funding availability (NFAs).

  • Review process for contracts (Sec. 16a(4))

    • Timeline: within 30 days after council establishment, the department must provide the council with proposed contracts (or amendments) no less than 120 days before signing.
    • Content: proposed contracts must include draft language on rates, scope of services, performance expectations, indemnification/insurance, and other material terms.
    • Council action: the council has up to 45 days to issue a written recommendation (support, opposition, or modifications) after receiving material.
    • Department response: the department must respond in writing to each recommendation, stating acceptance, modification, or rejection and rationale.
    • Effect: except as noted, contract execution cannot proceed until the council’s review and department response are completed.
    • Reporting: the department must transmit the council’s written response to the House and Senate committees with jurisdiction over child welfare.

  • Noncompliance and exceptions (Sec. 16a(5))

    • If the department proceeds with a new or amended contract without complying with subsection (4), it must publish a written explanation on its public website within 10 business days of the decision and no later than 60 days before the contract takes effect.
    • Subsection (4) does not apply in:
    • Governor-declared public health or child welfare emergencies.
    • Contracts required to comply with federal statute, rule, or judicial order.

  • Conflicts of interest and ethics (Sec. 16a(6)-(8))

    • Members must act with integrity, impartiality, and transparency; they must file annual conflict-of-interest disclosures and update them as needed.
    • For each contract under consideration, members must disclose any material financial interest related to a counterparty and recuse from related discussions/votes. Recusal and disclosures must be reflected in meeting minutes.
    • Prohibited activities: members cannot solicit or accept gifts of value from entities with a financial interest in a contract, nor engage in anti-competitive practices (e.g., bid rigging, price fixing).
    • Violations constitute a material breach and may lead to disqualification, contract termination, damages, sanctions, or referral for criminal charges.

  • Enrollment and department authority (Sec. 16a(9)-(11))

    • The department may remove a council member for repeated or willful failure to disclose conflicts, failure to recuse, or knowingly submitting false information (with due process).
    • The department must not retaliate against a member who reports suspected conflicts or violations in good faith.
    • The term “council” refers to the Provider Advisory Council established under subsection (1).

Who is affected

  • Child caring institutions and child placing agencies operating in Michigan, particularly those that would enter into contracts or amend existing contracts with the state department for licensure, funding, services, or oversight.
  • Department of Health and Human Services (or the relevant state department responsible for child welfare and licensing) which would implement and manage the council, contract pre-review, and communications.
  • Statewide professional associations serving children and families that may participate as nonvoting members and assist in nominating council candidates.

Procedural and timeline considerations

  • Establishment deadline: council must be created within 90 days of the amendatory act’s effective date.
  • Contract review timeline: the council receives proposed contracts at least 120 days before signing; it has up to 45 days to issue a written recommendation.
  • Department response requirement: the department must address each recommendation in a written response.
  • Public reporting: responses must be shared with the relevant legislative committees; noncompliance triggers an explanatory public posting.
  • Emergency/federal constraints: exceptions exist for declared emergencies and federally mandated contracts.
  • Ethics framework: formal disclosure, recusal, and anti-corruption provisions apply to council members, with enforcement mechanisms.

Potential impact

  • The bill introduces a formal, independent advisory mechanism for evaluating state contracts with child care providers, potentially enhancing transparency and stakeholder input in funding and service arrangements.
  • It may influence contract terms by elevating scrutiny of rates, services, and protections, potentially slowing contract execution but improving due diligence.
  • Strengthened ethics requirements could reduce conflicts of interest and bolster public trust in contract decisions.
  • Providers and associations may need to adapt to more structured pre-award review processes and disclosure obligations.

If you’d like, I can provide a plain-language quick brief for policymakers or a comparison with similar advisory councils in other states.

Compiled from official sources — confirm details with the bill’s official record.

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