This guide is designed to provide information about transitional child care (TCC) program policies and operations and to offer recommendations to policymakers and advocates. Transitional child care is a new federal child care program that every state must implement by April 1, 1990. Established by the Family Support Act (FSA) of 1988, TCC is designed to help families with dependent children meet their child care needs for one year after they lose federal or state financial assistance for income-related reasons. Recommendations are based on information from nine states with transitional child care programs that predate FSA requirements; extensive discussions with officials and advocates; and a review of 30 state plans for transitional child care programs. Sections of the guide concern: (1) the process of becoming eligible for transitional child care, and the related issues of notification, outreach, the request and approval process, verification, and reporting; (2) things to consider after eligibility is established, including child care counseling and location services, payment rates and policies, choice of a payment mechanism, and a sliding fee scale; and (3) long-range issues, including budgeting adequate funds, learning from experience, and arranging for child care after TCC participation. Appendices provide federal regulations on TCCs and an overview of voucher and contracted payment mechanisms. (RH)