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Opening an RCFE

RCFE Startup Costs in California

By Sevana Care · Checked against cdss.ca.gov and California law on

The state charges a one-time application fee and a yearly fee, both set by capacity. For a home with 4 to 6 residents:

Every year

Annual fee
$495.60 a year [1]

Once

Application fee
$990.00 to apply [1]
Administrator certificate
$140 initial application plus a $100 exam [6][7]

Per person

Department orientation
$50 in the statute, $54.85 online, for each person who attends [1][5]
Live Scan fingerprints
a fee for each person who must be cleared. CDSS's schedule says the fees "are the responsibility of the Live Scan applicant" [10][11]

Must hold

Liability insurance the law requires
at least $1,000,000 per occurrence and $3,000,000 in total claims per year (the annual aggregate) [16]
Start-up funds
three months of operating costs, which CDSS checks you hold [4][17]

No state price

No source we checked gives a price for staff wages, staff training hours, the administrator training course, building permits, construction work, the insurance premium or the bond premium. None gives a dollar target for the three months of start-up funds.

State fees by capacity

Health and Safety Code § 1569.185(a)(1) says an "application fee adjusted by facility and capacity shall be charged by the department for the issuance of a license" [1]. It goes on: "After initial licensure, a fee shall be charged by the department annually on each anniversary of the effective date of the license." [1] These are the first five bands; the statute continues up to 701 or more residents [1].

CapacityApplication (once)Annual
1 to 3$495.60$495.60
4 to 6$990.00$495.60
7 to 15$1,486.80$742.80
16 to 30$1,980.00$990.00
31 to 49$2,476.80$1,238.40

CDSS's own fee schedule, effective January 1, 2015, shows the same bands with the cents dropped, for example $495 and $990 [21].

Other state fees in the same section [1]:

  • A change of capacity, up or down, costs $25.
  • Moving to a new address costs 50 percent of the application fee.
  • A $200 plan of correction fee applies when a licensee does not carry out a plan of correction by its date.
  • Not paying fees or civil penalties is grounds for denial or loss of a license.
  • "A local jurisdiction shall not impose a business license, fee, or tax for the privilege of operating a facility licensed under this chapter that serves six or fewer persons" [1].
Careful

The statute sets a "late fee that represents an additional 50 percent of the established current annual fee when a licensee fails to pay the current annual licensing fee on or before the due date as indicated by postmark on the payment" [1]. CDSS's fee page counts "the date payment is received by the Cashier" instead. It tells you to pay before your anniversary date and to allow time for the U.S. Postal Service to process a mailed payment [2].

CDSS says the application fee is not refundable, and that fees cannot be waived or refunded once paid, except for a documented department error or a real overpayment [2][3].

Costs the rules require

Orientation. Each person who attends a department orientation pays $50 under the statute [1]. CDSS's online orientation, called Component I, charges $50 plus a $4.85 processing fee, $54.85 in all, non-refundable [5].

Administrator certification. An RCFE administrator must complete an approved certification training program before employment [20]. The training is 80 hours, at least 60 of them live and interactive [20]. Since July 10, 2023, the live part can be in person or by live-stream [8]. The applicant then passes a state exam [20]. CDSS lists a $100 exam fee, which covers three attempts, and a $140 initial application fee [6][7]. See the administrator certificate page.

Fingerprints (Live Scan). These people need a criminal record clearance or exemption [9]:

  • the applicant
  • the administrator
  • anyone other than a resident who lives in the home
  • officers and anyone with a 10 percent or larger stake
  • staff or volunteers who have contact with residents

Section 1569.17(b)(2) lists people who "are exempt from requirements applicable under paragraph (1)", such as some supervised volunteers [9]. The fee schedule CDSS links, effective December 11, 2015, lists $59 per person for an RCFE: $42 to the Department of Justice and $17 to the FBI, plus a site fee that varies by location, and says the fees are the responsibility of the Live Scan applicant [11]. The Department of Justice's own fee table, dated August 17, 2012 and marked subject to change, shows the same $42 and $17 per person for adult day and residential care [12]. Ask the Live Scan site for today's charge, because CDSS says the operator tells you the charges [10].

Fire clearance. After it accepts your application, CDSS asks the local fire authority for the final fire clearance inspection [4].

  • Pre-inspection, if you want one. Before that, you can ask the local fire authority for a pre-inspection, which is a consultation before the final fire clearance. Use form LIC 9092, and send the form and the fee to the fire authority, not to CDSS [13]. Section 13235, printed on the form, says "A fee equal to, but not exceeding, the actual cost of the pre-inspection services may be charged" [13].

  • One fire authority's prices. Ventura County Fire's 2024-2025 fee schedule lists $480 for an initial licensed care fire clearance and $280 for a "Licensed Care Pre-Inspection for I's, R's, and Day cares" [23].
  • The rule says

    Homes for six or fewer. Health and Safety Code § 1569.84 says "Neither the State Fire Marshal nor any local public entity shall charge any fee for enforcing fire inspection regulations" for an RCFE that serves six or fewer persons [24].

  • Larger single-story homes. For a single-story RCFE licensed for more than six persons that houses nonambulatory residents, § 13131.5 requires, among other things, "a State Fire Marshal approved fully automatic fire extinguishing system" and "a State Fire Marshal approved and listed manual fire alarm system" [14].

Liability insurance. An RCFE must keep liability insurance covering injury to residents and guests of at least $1,000,000 per occurrence and $3,000,000 in the annual total, for the negligent acts or omissions of the licensee or its employees [16][19]. The statute excepts "those facilities that are an integral part of a continuing care retirement community" [16].

Surety bond. CDSS's LIC 400 says RCFE applicants and licensees "that handle or will handle monies of residents must be bonded for not less than $1,000.00" [15]. It adds: "However, the provisions of this section do not apply if the applicant/licensee handles or will handle monies of persons within the facility in amounts less than fifty dollars ($50) per person and less than five hundred dollars ($500) for all persons per month." [15] The bond amount rises with the money handled [15]:

Resident money handled a monthBond
$750 or less$1,000
$751 to $1,500$2,000
$1,501 to $2,500$3,000

LIC 400 adds: "Every additional increment of $1,000.00 or fraction thereof shall require an additional $1,000.00 on the bond." [15]

Money CDSS checks you have

CDSS's financial review checks that a new home has start-up funds for three months of operating costs [4]. The application booklet says: "Only cash and cash equivalents should be considered for meeting the three month start-up funds requirement. Cash equivalents are those assets which are readily converted to cash in one week or less." [17] The booklet also accepts a verifiable line of credit from a reputable financial institution, if it is readily accessible [17]. It says start-up funds should not be consumed on renovation or repair work [17]. CDSS reviews the applicant's credit history too [3].

Costs with no state price

Staff time and training. For staff "who assist residents with personal activities of daily living", § 1569.625(b) says "This training shall consist of 40 hours of training" and adds "an additional 20 hours annually" [18]. The hours break down this way [18]:

WhenHoursIncluding
Before working independently20six on dementia care and four on postural supports, restricted health conditions and hospice care
Within the first four weeks20six on dementia care
Each year after that20eight on dementia care and four on postural supports, restricted health conditions and hospice care

Subdivision (d) has its own rules for "certified nurse assistants", "licensed vocational nurses" and "registered nurses" [18]. Direct care staff must also hold first aid training, and the applicant or administrator's first aid card goes with the application [17].

Staffing. The law requires an administrator, facility manager or designated substitute, age 21 or older, on the premises 24 hours a day [22].

Building and permits. CDSS's RCFE Pre-Licensing CARE Tool quotes the rule: "Prior to construction or alterations, all facilities shall obtain a building permit" [19]. CDSS tells applicants to finish construction and secure funds before they apply, and says larger homes need a conditional use permit [3].

Application paperwork. An infection control plan must be part of every application for an initial license [3].

Questions

How much does an RCFE license application cost?

$495.60 for 1 to 3 residents, $990.00 for 4 to 6 and $1,486.80 for 7 to 15. It is not refundable [1][3].

What do I pay every year?

The annual fee on each anniversary of the license date: $495.60 for 1 to 6 residents, $742.80 for 7 to 15 [1].

Does a small home need liability insurance?

Section 1569.605 says "all residential care facilities for the elderly, except those facilities that are an integral part of a continuing care retirement community, shall maintain liability insurance" [16].

What does it cost to become an administrator?

CDSS lists $140 for the initial application and $100 for the exam [6][7]. CDSS publishes no price for the training course.

Sources

  1. California Health and Safety Code § 1569.185, Fees (leginfo.legislature.ca.gov)
  2. CDSS, Licensing Fee Information
  3. CDSS, Centralized Applications Bureau, How to Become Licensed
  4. CDSS, Adult and Senior Care Program Application Process (PDF)
  5. CDSS, Online Orientations
  6. CDSS, Administrator Certification Bureau (fees table)
  7. CDSS, Administrator Certification Initial Procedures
  8. CDSS, PIN 23-14-CCLD, Changes to Administrator Certification Training Requirements (8/30/2023, PDF)
  9. California Health and Safety Code § 1569.17, Criminal record clearance (leginfo)
  10. CDSS, Live Scan Application Process and Associated Fees
  11. CDSS, Live Scan Fingerprint Rate Schedule, effective December 11, 2015 (PDF)
  12. California Department of Justice, Applicant Fingerprint Processing Fees, as of August 17, 2012 (PDF)
  13. CDSS, LIC 9092 (2/11), Fire Pre-Inspection/Consultation Request, which prints Health and Safety Code § 13235 (PDF)
  14. California Health and Safety Code § 13131.5 (leginfo)
  15. CDSS, LIC 400 (1/99), Affidavit Regarding Client/Resident Cash Resources (PDF)
  16. California Health and Safety Code § 1569.605, Liability insurance (leginfo)
  17. CDSS, LIC 281 (11/25), Application Instructions for a Facility License (PDF)
  18. California Health and Safety Code § 1569.625, Staff training (leginfo)
  19. CDSS, RCFE Pre-Licensing CARE Tool (Excel workbook)
  20. California Health and Safety Code § 1569.616, Administrator (leginfo)
  21. CDSS, Fee schedule effective January 1, 2015 (PDF)
  22. California Health and Safety Code § 1569.618 (leginfo)
  23. Ventura County Fire Protection District, Fee schedule fiscal year 2024-2025, effective July 1, 2024 (PDF)
  24. California Health and Safety Code § 1569.84 (leginfo)