Financing Child Care in the United States - Ewing Marion Kauffman ...

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SOCIAL AND HUMAN SERVICES RHODE ISLAND CHILD CARE ENTITLEMENT (RHODE ISLAND) DESCRIPTION Rhode Island has established a child care entitlement program to help pay the child care costs of families with limited earnings (at or below 250 percent of the federal poverty level, which is about $34,000 a year for a family of three). WHEN ESTABLISHED The child care entitlement was initially established as part of welfare reform legislation, the Rhode Island Family Independence Act, enacted in August 1996. It was expanded (to raise the eligibility ceiling and cover children age 13 to 16) as part of Starting RIte legislation, which passed in 1998. ANNUAL AMOUNT Rhode Island estimated FY2000 expenditures of $42.4 million (for approximately 9,000 children). Funding comes from the federal Child Care and Development Fund (CCDF), Temporary Assistance for Needy Families (TANF) fund transfer and state general revenues. SERVICES FUNDED The subsidies may be used to purchase any form of legal child care: centers, family child care homes, in–home child care or care provided by relatives. Parents choose the type of care they prefer. Approximately 70 percent of subsidized children are cared for by regulated providers. HOW FUNDS DISTRIBUTED Funds are administered as portable subsidies (vouchers), tied to a specific child and program. Child care providers are reimbursed by the Rhode Island Department of Human Services every four weeks. Co–payments are collected from families by the child care providers. POPULATION SERVED All families with incomes at or below 250 percent of poverty (about $34,000 for a family of three for 2000) are entitled to a child care subsidy. Families must be employed or in an education or training program and have a child age 16 or younger who needs child care for all or part of the day. Families who are not participating in Temporary Assistance for Needy Families (TANF) are required to contribute to the cost of child care through a co–payment. The co–payment is approximately 3 percent of gross income for families with incomes between 100 percent and150 percent of poverty and 2 percent of gross income for families with incomes at or below the poverty level. STRATEGIC CONSIDERATIONS • Rhode Island is the only state in the country in which child care is guaranteed to families based on income alone, without reference to welfare status or time limits. Families are eligible if they are working or enrolled in education and training programs. • Passage of the child care entitlement was a critical part of Rhode Island’s vision that child care and health care are the building blocks that must be in place to ensure successful, sustainable transitions to the work force. • In addition to providing child care as an employment support for low–income families, Rhode Island is committed to ensuring that all children have access to the high quality care and learning opportunities they need to succeed in school and life. To this end, the state included an additional $7 million in the 1998 Starting RIte legislation to support several quality improvement initiatives. These included: improved provider reimbursement rates (to reach the 75th percentile—a 32 percent increase); expanded training for child care providers; support for early childhood program accreditation; innovation and start–up grants to expand the quality and supply of early childhood and school–age child care programs; and grants to expand the number of children that receive comprehensive services in Head Start and/or child care programs. • Strong leadership from Governor Lincoln C. Almond (R), State Representative Nancy Benoit (D) and Department of Human Services Commissioner Christine Ferguson was instrumental in passing this legislation. OTHER SITES WITH SIMILAR STRATEGIES No other examples of a state electing to use general funds, CCDF and TANF funds for a child care entitlement are known. CONTACT Sherry Campanelli Associate Director Rhode Island Department of Human Services LP Building 600 New London Avenue Cranston, RI 02920 Phone (401) 462 2423 E–mail scampane@gw.dhs.state.ri.us 59
AT–HOME INFANT CHILD CARE PROGRAM (MINNESOTA) DESCRIPTION Minnesota’s At–Home Infant Child Care Program (AHIC) makes subsidies available to low–income parents who are not receiving public assistance and who choose to stay home to care for an infant. WHEN ESTABLISHED Legislation was passed in 1997 and implemented in July 1998. ANNUAL AMOUNT Each year the state sets aside up to 7 percent of the funds appropriated for the Basic Sliding Fee program (Minnesota’s federal and state funded child care subsidy program) for AHIC. In FY98 $3.5 million was set aside and $31,000 was spent. Unspent funds were made available for the remainder of the Basic Sliding Fee program. SERVICES FUNDED AHIC provides eligible parents with a monthly stipend equal to the Basic Sliding Fee program rate in their county, minus the parent share of the fee. The parent share (or co–payment) is based on family income. The AHIC rate is 75 percent of the approved hourly infant rate for the county. A few examples are: • A Minneapolis two–parent family with two children (one toddler and one infant) and one fully employed parent who earned $10,610 a year would receive $415 per month. • The same family would receive $373 per month if one fully employed parent earned $20,000 a year. • The same family would receive $104 per month if one fully employed parent earned $30,610 a year. A family is limited to a lifetime total of 12 months of AHIC. POPULATION SERVED The program has served 87 families since it was implemented in 1998. The average length of participation is three months, and the average benefit is $1,486. HOW FUNDS DISTRIBUTED The state allocates funds to the county social service departments, which in turn administer the funding as a part of the Basic Sliding Fee program. The counties are responsible for accepting applications from, and mailing checks to, eligible parents. Counties have the flexibility to determine how application is made as long as they provide at least two methods of application. In some counties parents can apply by mail. Families may apply for AHIC before the child is born or anytime during the child’s first year, but funds are not retroactive. Funds are awarded on a first–come–first–served basis. Each county maintains a waiting list if the available funds are depleted. POPULATION SERVED Low–income parents who are at least 18 years old and choose to stay at home with a child who is less than 1 year old may apply for AHIC. Eligible parents include birthparents, adoptive parents or stepparents. Parents must: • Have been working, going to school or looking for work before the child was born; • Have a family income at or below 75 percent of the state median income ($34,274 for family of 3); • Provide full–time care for the child in the child’s home as well as for any other children in the family that are eligible for subsidized child care. STRATEGIC CONSIDERATIONS • The AHIC program builds on Minnesota’s long–term, successful child care subsidy program—the Basic Sliding Fee program. AHIC is designed to respond to the needs of children and families, offers a less expensive alternative to paying for infant care and addresses the severe shortage of quality infant care. • Some organizations and individuals were initially concerned that AHIC would draw funds away from the Basic Sliding Fee program and make it more difficult for working families to obtain subsidized child care. But, at least in the first year of implementation, this has not been the case. Participation has been slow. The Minnesota Department of Children, Families and Learning recently published a brochure that explains the program and provided training to county staff on implementation of the program. Participation is likely to increase as more families learn about the program. • Minnesota exempts public assistance recipients with children less than 1 year old from participating in employment. This allows these families to remain at home with an infant without participating in AHIC. OTHER SITES WITH SIMILAR STRATEGIES Missouri recently set aside funds for an initiative to support parents who choose to stay at home and care for their own children. For more information, contact Doris Hallford, from the Missouri Department of Social Services, at (573) 522 1137. 60
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FINANCING CHILD CARE IN THE UNITED
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FINANCING CHILD CARE IN THE UNITED
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ABOUT THE GRANTEE PHILADELPHIA CITI
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:02 ALLOCATING PUBLIC REVENUES 54 O
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HOW TO USE THIS CATALOG This catalo
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This revised, expanded edition of F
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DIFFERENT EXPECTATIONS The expectat
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03 LONG-TERM THINKING Successful st
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EMPLOYERS Employers increasingly re
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EMPLOYERS AT&T FAMILY CARE DEVELOPM
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FINANCING CHILD CARE IN THE PRIVATE
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PHILANTHROPY ALLEGHENY COUNTY EARLY
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When businesses in the private sect
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CAPITAL INVESTMENT PARTNERSHIPS CHI
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PUBLIC-PRIVATE PARTNERSHIPS CAPITAL
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LOOKING TO THE FUTURE TAX POLICY Th
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LOOKING TO THE FUTURE THE HOME MORT
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LOOKING TO THE FUTURE HIGHER EDUCAT
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APPENDIX 174
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WHAT YOU OWN Property taxes on real
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INDEX 178
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Child Care Scholarship Fund of the
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lotteries and gaming, 14 Neighborho
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Area, Kansas and Missouri), 133—1
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income tax provisions for child car
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