PW special update: The crisis in child care

U.S. House votes for big funding boost as two new reports document the problem in NC 

[Editor’s note: One of the many preexisting structural problems in American society exposed and exacerbated by the COVID-19 pandemic is the inadequacy of the nation’s child care system. For several years now, analysts and advocates have advanced report after report documenting the fact that the nation’s system for providing early childhood education is underfunded, inadequate and fragile. Today, however, with the COVID-19 pandemic continuing to rage, many believe the system could, effectively, be on the verge of collapse.

In an effort to help shine more light and jump-start discussion on this vitally important subject, this Policy Watch special update features three new “must reads” on the subject:

• a news report from our Washington, DC bureau summarizing action taken by the U.S. House last night to advance child care funding legislation, and
  
• a pair of new reports from researchers at the NC Budget & Tax Center that document the situation in North Carolina.]

U.S. House passes package to rescue child care industry

By Allison Stevens

WASHINGTON — The U.S. House stepped in Wednesday to try to rescue the nation’s child care system from collapse under the weight of the pandemic.

The chamber approved a pair of bills that backers say are needed to fully reopen the economy and shore up the child care industry in the longer term.

The bills now advance to the GOP-controlled Senate, where their fates are uncertain.

One bill would provide $50 billion in emergency funds to stabilize the child care sector and help providers safely reopen and operate as COVID-19 infections surge across the country. The money would be administered through a federal block grant program and distributed to eligible child care centers, home-based providers and family child care homes.

The other would invest up to $10 billion per year through 2024 in the nation’s child care infrastructure, change federal tax policy to help workers access child care and help providers cover expenses, and more.

Both passed largely along party lines.

The stabilization fund bill called the “Child Care Is Essential Act” passed by a vote of 249 to 163. Two hundred and thirty-one Democrats and 18 Republicans voted for the bill, and 162 Republicans and one Independent voted against.

All three North Carolina Democrats (Adams, Butterfield and Price) voted “yes.” Five of the state’s nine Republicans members (Bishop, Budd, Foxx, McHenry and Murphy) voted “no.” Four GOP members from North Carolina (Holding, Hudson, Rouzer and Walker) did not vote.

The infrastructure package passed by a similar margin. Two hundred and fifty lawmakers — 230 Democrats and 20 Republicans — backed the bill, while 161 — 160 Republicans and one Independent — opposed it. All 12 North Carolina members voted (or didn’t vote) the same as on the stabilization measure.

Proponents said the government must save the child care industry in order to save the economy.

“We can’t get people back to work until we have widespread access to safe, quality and affordable child care,” House Speaker Nancy Pelosi (D-Calif.) said on the House floor ahead of the votes.

Rep. Haley Stevens, a Michigan Democrat who co-led the stabilization fund legislation, echoed the sentiment in a statement. “We cannot talk about reopening our economy without having a conversation about how families will care for their children,” she said.

The issue is of concern to mothers, who are more likely than men to take on unpaid caregiving labor when their family can’t find affordable care, according to the Center for American Progress. As a result, many mothers — and particularly single mothers — are forced out of the workplace and experience significant financial repercussions over their lifetimes. But the issue is also important for dads, especially as more men take on caregiving roles, and for society at large, Pelosi said at a press conference before the votes.

House Majority Leader Steny Hoyer, a Maryland Democrat, added that lack of safe, quality and affordable child care also harms people of color in particular.

House Republicans balked, saying the legislation would create “more bureaucratic red tape.”

North Carolina Rep. Virginia Foxx, ranking Republican on the House Education and Labor Committee, called the child care stabilization fund a “partisan messaging bill” that would “recklessly” spend taxpayer dollars.

Rep. Kay Granger of Texas, ranking Republican on the House Appropriations Committee, said the child care infrastructure bill “misses the mark.” She noted that funding provided in the $2.2 trillion CARES Act passed in March has yet to be fully spent and said safeguards are needed to ensure the money goes to those who need it most — a problem that plagued the federal loan forgiveness program approved in March.

In crisis before the pandemic

Many noted that the industry was in crisis before the pandemic and is more so now.

In many parts of the country, child care costs rival the cost of college tuition — and are out of reach for many families, according to a 2019 report by Child Care Aware of America.

Black families bear a disproportionately high burden, according to the Center for American Progress. In 2016, the average annual cost of center-based child care for an infant and a 4-year-old was nearly $18,000, more than 40 percent of the median income for a typical Black family, according to a report the center issued that year.

Yet wages are low at most child care centers.The typical U.S. child care worker earns $11 per hour, according to the Center for American Progress. Most are women, and a disproportionate number (40{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99}) are of color, according to a 2019 report by Child Care Aware of America.

The COVID-19 pandemic has exacerbated problems in the industry.

Providers are serving far fewer children than they were before the pandemic, which has led to major drops in revenue. And they now face expensive and time-consuming safety protocols.

In July, the Centers for Disease Control and Prevention updated its guidelines for child care centers that remain open, urging them to implement screening and social distancing strategies, intensify cleaning and modify drop off and pick up procedures.

Nearly half of child care centers were forced to close this spring, according to an April survey conducted by the National Association for the Education of Young Children (NAEYC). And another 17{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99} closed services to all but the children of essential workers.

Virginia Rep. Bobby Scott, a Democrat who chairs the House Education and Labor Committee, pointed to an April report by the Center for American Progress and NAEYC that found the sector could permanently lose as many as 4.5 million child care slots — about half the national capacity — without public funding.

“It’s a crisis,” Rep. Rosa DeLauro, a Connecticut Democrat who has championed the issue, said Wednesday at a press conference before the vote.

In March, Congress approved $3.5 billion in additional funding for child care through a block grant program. The emergency funds were intended to help emergency and frontline workers access child care during the COVID-19 pandemic and help stabilize the child care market.

Child care providers are also eligible for short-term loans authorized in March under the CARES Act.

In May, the U.S. House passed another $7 billion in emergency child care funding as part of a $3 trillion coronavirus relief package known as the HEROES Act.

Senate Republicans panned the HEROES Act and introduced their own $1 trillion proposal this week. It would provide $5 billion in emergency grants to child care providers and $10 billion to help them reopen during the pandemic, among other things.

Lawmakers are far from reaching consensus on the packages, but proponents of the child care bills urged House and Senate leaders to include child care stabilization funding in the next coronavirus relief package.

“Roughly two in three voters say it is essential or very important that Congress include support for child care in upcoming relief legislation,” said Katie Hamm, vice president of early child policy at the Center for American Progress. “As leaders negotiate a final deal in the coming weeks, they should heed the public’s will.”

Advocates for women and families, meanwhile, say the sector needs substantial, long-term support.

The National Women’s Law Center and the Center for Law and Social Policy released a report in April that said the nation’s child care system needs at least $9.6 billion a month in public funding during the pandemic to avoid permanent closures and economic destabilization. Some 500 organizations signed on to a letter in April asking Congress for at least $50 billion in stabilization funds as well as longer-term solutions to address pre-existing gaps.

“Without these investments, we risk the disintegration of our child care infrastructure, leaving children, families, and child care workers with no system to return to as we recover,” the groups wrote.

 

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Taking steps toward a stronger child care system post-pandemic

By Alexandra Sirota

Every child should have the opportunity to access a quality early education and a safe, supportive care environment, but too many of the youngest North Carolinians continue to be blocked by policies that keep such opportunities unaffordable and inaccessible to their families.

Before the coronavirus, early childhood education’s financing model left nearly half of the state’s children living in child care deserts, where there aren’t enough slots to accommodate the need in a community. Even with high tuition fees and low labor costs, child care providers operate on the slimmest of margins, and the COVID-19 pandemic has wreaked havoc on an already financially precarious industry that supports children’s well-being and parents’ work.

Quick action by the state Department of Health and Human Services to provide emergency funding and supports has allowed approximately 84{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99} of child care centers and 92{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99} of family homes to re-open, but most are operating at dramatically reduced enrollment. Because of the loss of tuition, coupled with increased health and safety costs, many programs are at risk of shutting down permanently.

While emergency measures are needed to prevent the collapse of our early education system, we also need to focus on enacting measures that rebuild a stronger child care system to support our state’s future economic recovery. The cost of delivering quality care, including the dire need for a living wage for early education teachers, far outstrips parents’ ability to pay for that care. An affordable, accessible child care industry requires a bolder public commitment of resources. As financing is restructured for long-term sustainability, policymakers could stabilize the system by creating a minimum reimbursement rate for providers who serve children in need.

Setting such a payment floor in child care assistance would ensure that programs, regardless of their location, would receive more equitable public funding to provide quality care. This action would strengthen the child care system, supporting programs in remaining open in the economic aftermath of the pandemic and allowing children and families greater access to quality care.

Click here to keep reading “Taking steps toward a stronger child care system post-pandemic.”

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Equitably financing child care in every North Carolina county

By Alexandra Sirota, Greg Borom and Patrick McHugh

The delivery of quality early child care and education to everyone who needs it is hampered in two major ways: It lacks public investment, and because of stagnant and often subpar wages, parents can’t afford it for their children  But through equitable and public financing, North Carolina can build a quality, accessible early childhood system.

Without attending to child care providers’ funding needs, North Carolina is not only falling short of serving every child, but also is failing to reap the full benefits of quality early learning experiences. Recent research by the Center for American Progress found that 42{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99} of North Carolina children under age 5 live in child care deserts — communities where there are too few child care slots to meet demand. And in areas where slots are available, early childhood care and education is often unaffordable. On average, North Carolina families with young children devote approximately 25{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99} of their income to child care costs.

NC’s child care subsidy program helped cover some of the costs of licensed early childhood care and learning for approximately 72,316 children and their families each month. Such financial support is important in making early childhood care and education opportunities affordable and in supporting the development of quality programming. However, this federal- and state-funded program, referred to most commonly as child care subsidy, falls short every year of meeting the demand for assistance from families across the state.

As of April 2019 more than 38,000 children were on the waiting list for a subsidy. Many more are eligible for the program based on income and parents’ work status, but are not represented in this figure. Variations in county-level wait list practices, knowledge of the program among eligible families, and limitations of NC FAST system in collecting data mean 38,000 is likely a significant undercount. After accounting for those factors, North Carolina is serving only an estimated 10{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99} of those eligible under federal standards.

The number of children enrolled in high-quality early childhood care and education has remained stable. According to the most recent data from the Division of Child Development and Early Education, 77{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99} of children up to 2 years old receiving child care subsidy are in four and five-star programs; 75{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99} of children ages 3 to 5 years old receiving child care subsidy are in four- and five-star programs.

North Carolina has established important policies to support access to higher quality programs for families receiving a child care subsidy. These includes a cap on assistance provided to those enrolled in child care program that have fewer than three stars. However, more progress is critical to ensure the accessibility and availability of early childhood care and education for children whose families receive assistance.

There are two important issues to financing early childhood care and education in North Carolina. The first has been noted quite extensively in analysis of the state budget, which finds that the overall level of funding is insufficient to achieve access and quality. Recent estimates based on last year’s budget find that the state’s commitment to the child care subsidy program has declined by 53{a38ddb2ded6b05e28c8ae73a8db0e271c21f7193684bd9e4e28acae292f81d99} since Fiscal Year 2007-2008. Fewer children are enrolled in the child care subsidy program as a result.

The second issue is how the dollars are allocated in the system. The rate at which early childhood care and learning providers set their tuition rarely reflects the full cost of what it takes to provide care, especially when considering the standards of quality that deliver the greatest return to the child, family, and broader community.

Click here to keep reading “Equitably financing child care in every North Carolina county.”