Increases appropriations for child care payments to localities under the child care block grant program

Additionally, this bill expands eligibility in the Facilitated Enrollment program to families up to 400% of Federal Poverty Level. It also caps the family contribution to the child care cost at 10% of the family's household income.

Summary of specific provisions

Section 1 amends appropriation language to add $82 million to the state child care block grant for subsidies, plus another $100 million to the block grant for facilitated enrollment programs.

Sections 2-3 amend social services law to expand eligibility from 200% or 275% (depending on program) to 400% of the federal poverty level.

Section 4 amends social services law to place a cap on family copays of 10% of household income.

Justification

Out of all the states in the Union, New York tops the list of least-affordable child day care centers for school-aged children, and has the dubious honor of being second place behind Oregon for least-affordable care rates for infants and preschoolers. Child care affordability has made for too many sleepless nights for both low-income and middle-class working parents, who are already spreading their dollars thin on rising housing, fuel, and food costs.

The New York State Child Care Block Grant (CCBG) provides some support for parents who need child care so they can go to work or school, including subsidies that pay child care providers for a large part of their fees. Unfortunately, the block grant has never been able to meet the need, and worse, has been shrinking over the years.

In 2012, there were 836,469 children in New York State under the age of 6 with working parents, and only about 21,400 licensed day cares serving children up to age 12. Overall, 690,000 children were cared for by these providers across the state, but only about one-third (234,000) of them received subsidies. In New York City alone, approximately 40,000 families are on waiting lists for subsidies.. Demand is high and costs are soaring right up along with it. Restoring the general subsidies in the NYS Child Care Block Grant to

their 2010-11 levels would cost the State about $82 million and open about 13,000 new child care slots statewide.

Additionally, the expansion of child care subsidies would have a positive rate of return on the economy. In the short term, more parents would be able to afford to return to work. Employee absenteeism due to child care issues costs U.S. business $3 billion every year. As more parents can afford to return to work, that time on the job translates into seniority, increased job skill, and higher earnings.

Children would benefit greatly from expanded subsidies, too. Many of these state and city-funded facilities include an early learning component. Early learning can lead to increased earnings, higher education, improved physical and mental wellbeing for the child, and ultimately public expenditure savings and increased tax revenues justifying the initial investment of public funds into child care subsidies. Economists estimate the rate of return for high-quality early intervention child care for low-income families to be about 6-10% per year.

This bill also includes a $100 million expansion of the Facilitated Enrollment subsidy within the NYS Child Care Block Grant, opening the doors to about 14,285 more children in the program. The Facilitated Enrollment Program provides a unique model that combines subsidy administration with parent education and information. Since the project's inception, close to 3,900 families and over 6,400 children have been served through the pilot sites.

It is currently funded at $7.3 million for families who are up to 275% of the Federal Poverty Level (FPL), which is a $64,763 household income for a family of four, but - as recognized in the NYS Child Health Plus program - families up to 400% of FPL ($94,200/family of 4) are struggling to make ends meet and also need help.

Additionally, counties are authorized to charge families a copay for child care services of 10-35% of the families' income above the poverty line. Too often, the 35% copay for families with incomes at 250% FPL and above is more than the cost of child care, so even with additional program funds, too many of those families are turned away.

New York must not only restore the $82 million in child care subsidies that have been cut these last few years, but must find a way to bring more families into the realm of affordable child care.. The highly successful Facilitated Enrollment Program has proven its efficiency and effectiveness to become a permanent statewide program.

Prior legislative history

New bill.

Fiscal implications

$182 million to the State.

Effective date

This act shall take effect immediately, except that section one is retroactive to April 1, 2013 and sections 2, 3, and 4 will take effect January 1 after it is signed into law.