Section 98.40 - Compliance with applicable State and local regulatory requirements(a) Lead Agencies shall: (1) Certify that they have in effect licensing requirements applicable to child care services provided within the area served by the Lead Agency;(2) Describe in the Plan exemption(s) to licensing requirements, if any, for child care services for which assistance is provided, and a demonstration for how such exemption(s) do not endanger the health, safety, or development of children who receive services from such providers. Lead Agencies must provide the required description and demonstration for any exemptions based on: (i) Provider category, type, or setting;(iii) Providers not subject to licensing because the number of children served falls below a State-defined threshold; and(iv) Any other exemption to licensing requirements; and(3) Provide a detailed description in the Plan of the requirements under paragraph (a)(1) of this section and of how they are effectively enforced.(b)(1) This section does not prohibit a Lead Agency from imposing more stringent standards and licensing or regulatory requirements on child care providers of services for which assistance is provided under the CCDF than the standards or requirements imposed on other child care providers.(2) Any such additional requirements shall be consistent with the safeguards for parental choice in § 98.30(f) .63 FR 39981, July 24, 1998, as amended at 81 FR 67582 , Sept. 30, 2016