December 24, 2016

Child care subsidies to become less common

Pew - In many states, [child care] subsidies may be about to get scarcer. States are starting to implement a 2014 federal law that requires them to do more to ensure that children who receive subsidies have a safe, educational experience. The law also includes eligibility changes that will allow many families to keep receiving subsidy assistance for longer.

Child care advocates support the higher standards, but worry that they’ll prove costly and will push some states to serve fewer families. That could have far-reaching results for employers, as well as parents.

“We often say that parents are one unstable child-care arrangement away from losing their jobs,” said Helen Blank, director of child care and early learning at the National Women’s Law Center. Child care challenges can cause parents to show up late to work or not show up at all. This hurts both families and employers, who increasingly say they can’t find workers to fill their low-pay, low-skill positions.

Some states are already helping fewer children, Blank said, primarily because federal funding has fallen. In 2014, the number of children receiving subsidies fell to its lowest level since 1998.

A year’s child care for a Connecticut toddler can range from $7,000 to $20,000, according to the Connecticut United Way. That comprises between 23 and 62 percent of the average income for a nursing assistant in the state.

In addition to proposing guaranteed paid maternity leave, Trump has a child care plan based on tax breaks: a tax break for all mothers, an optional tax rebate for low-income mothers and flexible savings accounts.

His plan would largely benefit wealthy and stay-at-home parents, according to the Urban-Brookings Tax Policy Center, a nonpartisan Washington, D.C., think tank.

Congress expanded child care subsidies in the 1990s as part of welfare reform to help low-income parents stay in the workforce. 

Today, about 1.4 million children, mostly age 6 and younger, benefit from child care subsidies funded by the federal government and states. Recipients can use the subsidies to defray the cost of care in the child’s home, another family’s home, a group home or a center. States typically ask parents to pay a portion of the cost of care.

Studies consistently show that poor parents who receive child care subsidies are more likely to work and stay employed. 

But the program only reaches one in six children who are eligible under federal law, the U.S. Department of Health and Human Services found in 2011. Lack of funding is one reason why. Another is almost every state restricts the program to its poorest families.

Seventeen states currently limit enrollment to families earning below 150 percent of the federal poverty level, which is about $30,000 for a family of three, according to Blank of the National Women’s Law Center. Twenty states currently have waiting lists or are turning families away.

And families tend not to receive subsidies for long. The average family loses the benefit after about six or seven months. Sometimes families stop receiving subsidies because they no longer need help paying for child care. Other times families fall off the rolls because of a lost job or incomplete paperwork.

Workforce development officials say that losing the benefit can upend a fragile family’s finances. Take a $400 monthly subsidy away from a single mom who earns $12 an hour, and she can suddenly find herself spending over half her income on day care, said Clyde McQueen, president and CEO of the Full Employment Council in Kansas City, Missouri.

No comments: