This report provides an analysis of public policy issues associated with state and federal child care developments, laws, regulations, and bills. It is intended to aid policy makers, government officials, consumers, and practitioners of child care programs. The report examines three major areas of policy: (1) federal legislative action which culminated in passage of Title XX; (2) regulations which will determine the scope of state-federal implementation of social service legislation; and (3) the proposed Federal Family and Children Services Act of 1975. Discussion includes the impact of legislation and the question of responsibility for delivery of services. Five areas of concern in child care policy are investigated: money (source and flow), eligibility, administration, control, and program quality. Several recommendations directed toward federal and state government branches are made for each of the five policy areas. The appendices, approximately one-half of the report, include statistical data, comments by legislators and excerpts from federal child care regulations. (Author/ED)