Child Care: A Valuing Families Campaign Issue

Monday, September 25, 2006

Valuing Families

Child Care: A Valuing Families Campaign Issue

In state elections across the country, how to create quality, affordable child care has become a potent campaign issue.

Just this month in Wisconsin, Governor Jim Doyle made a proposed $3000 per child tax deduction for child care expenses a centerpiece of his reelection campaign. In Wyoming, Governor Dave Freudenthal touts legislation he signed this year to regulate and subsidize child care centers as a key part of attracting new workers to the state. In South Carolina, debate over regulation of large private child care providers has become a large political issue.

Additionally, two states are taking child care issues to the ballot box:

  • The Arizona First Things First ballot initiative would dedicate major new funding for early education.
  • Massachusetts has a ballot initiative this November to improve working conditions for child care workers under the state's subsidized child care program by allowing them to bargain collectively.

For parents who work, peace of mind is knowing their children are in quality child care. Especially for single mothers, 79% of whom are in the workforce, such programs can be an economic lifeline. And as studies continue to confirm the long-term economic gains for communities with strong child care systems, many business leaders are becoming key proponents for strengthening child care and early education systems in the states.

Back in July, the Dispatch profiled innovations in state preschool programs, so this issue highlights the ways states are encouraging quality, affordable child care for younger children. These include creating and reforming state tax child care tax credits, expanding direct subsidies for lower-income children, encouraging the creation of quality child care centers, and improving the working conditions of workers in the child care industry.

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Valuing Families

State Child Care Tax Credits

The federal government provides a Child and Dependent Care Credit that is based on a complicated formula that, because it is an offset against income taxes paid, is not available to the 58 million lower-income households who do not pay income tax. Many state programs suffer similar problems.

As an example, Gov. Doyle's proposal for a general tax deduction for child care expenses, while it will no doubt be helpful for many families, is not the best approach, since the announcement indicates it will not be refundable and will therefore give more financial help to better off families than to lower-income families who will receive little or no help at all.

Twenty-seven states currently have child tax credits or deductions, often tied to the federal tax credit in some way, such as using its calculation of eligible child care expenses and/or offering a credit as a percentage of the federal credit for which a person qualifies. As the National Womens Law Center explains in a recent report, only nine states have child care credits that are fully refundable and therefore available to all families regardless of how much income tax they pay.

The most generous child care tax credit is in New York, which extends a credit of $2,310 for families. This is more generous than the federal credit with the credit fully refundable for low-income families, a best practice for states considering creating or reforming their state child care tax credits.

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Valuing Families

Extending Child Care Subsidies

The flip side of tax deductions that help too few lower-income families are direct subsidies for child care that help poor families, but are often so restricted that families lose help once they get a job that pays even a bit more than a poverty wage. And federal block grants, including the Child Care Development Fund and TANF, have not been keeping pace with inflation, so states have cut child care aid in recent years and limited eligibility.

Under federal law, states are allowed to extend child care aid to families making up to 85% of their state's median income, but most states cut off child care subsidies at lower levels, some as low as 37% of state median incomes. This range of support in the states translates into a family of three in 2005 being eligible for child care subsidies at an annual income of $46,245 in Alaska but only up to $17,784 in Missouri. This can leave many lower-income families too poor to benefit from income tax credits but with too much income to qualify for direct child care subsidies -- a glaring hole in the system in many states.

Adding to the problem is that in too many states, even families that are eligible for child care subsidies face long waiting lists -- 280,000 children waiting for child care in California alone in 2005. States also need to make sure that copayments are not too burdensome on working families.

With so much focus in the welfare debate on getting former recipients into the workplace, as we discussed last week, helping all working families afford decent child care has to be a focus to the close the holes in the system. As studies show, families are far less likely to end up back on the welfare rolls if child care help is readily available when they enter the workforce.

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Valuing Families

Encouraging Creation of Quality Child Care Centers

Beyond cost, a serious problem for many families is finding quality child care centers. States have been taking action to promote better regulation of child care centers and developing programs to expand the choices for parents.

Part of the energy for these programs comes from the recognition that child care as an industry is becoming an increasingly important component of regional economic development, both for those in child care itself and as a supporting industry for other businesses that need quality child care available to attract and retain good employees. Many advocates point to the US military, which has created a model child care system for the 200,000 children of its members, a system that has been cited as demonstrating the advantages to all employers of having quality child to build employee morale and loyalty.

One oft-cited model is North Carolina's Smart Start program, which uses public-private partnerships to promote the availability of quality child care facilities, the model for Wyoming's new child care law. In other cases, state governments themselves can take a stronger role in directly contracting with providers to create new facilities, an especially needed approach to provide more options for children with special needs. Advocates are also increasingly arguing for integrating more sophisticated early education into child care programs to maximize the results down-the-line.

States are also recognizing that a key to quality child care is making sure work conditions of the child care workers themselves are improved, thereby decreasing employee turnover and encouraging long-term training and skill development. New York and Washington State this year enacted reforms to allow day care workers to form labor unions with collective bargaining rights, following the lead of Illinois Governor Rod Blagojevich who signed an executive order last year to allow 47,000 day care workers in that state the freedom to form unions to advocate for better conditions in the child care industry. (See this Dispatch for more).

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Valuing Families


The bottom-line is that progressives should be making support for quality affordable child care a core part of their agenda for valuing families -- and challenging rightwing "family values" politicians to either support those programs or stop hypocritically posing as friends of working families.

Investments in quality child care also need to be framed as long-term investments in society and the economy, since studies show children in high quality child care display greater language ability and math skills, develop better social skills with peers and teachers, all of which have impacts on a child's education throughout their career. Similarly, investing in quality child care has been shown to improve later behavior in school and decrease adult crime rates, leading to lowered costs for states and safer communities.

All of this is increasingly making promoting affordable quality child care a key issue for progressives in reaching out to working families.

More Resources

Social Benefits from Better Child Care

National Womens Law Center, Women’s Stake in Improving the Availability, Affordability, and Quality of Child Care and Early Education - documents how women as both working mothers and the main providers of child care depend on the child care system.
Federal Reserve of Minneapolis, Early Childhood Development: Economic Development with a High Public Return -- report documenting the economic development benefits to local and state governments from investing in child care programs.
Child Care and Parent Productivity: Making the Business Case -- Cornell report on how providing child care improves productivity, reduces absenteeism, cuts turnover and can increase company value.
Framing Child Care as Economic Development: Lessons from Early Studies -- Cornell study describes initial efforts to promote child care as a tool for economic growth.
Fight Crime: Invest in Kids, America’s Child Care Crisis: A Crime Prevention Tragedy -- details how at-risk kids without good child care are more likely to become chronic lawbreakers.

Tax Credits

National Womens Law Center, Making the Grade for Care: Ranking State Child and Dependent Care Provisions
National Womens Law Center, Making Care Less Taxing: Improving State Child and Dependent Care Tax Provisions -- outline how to improve state tax credits to make child care more affordable for poor and working families.
Urban Institute, State Tax Credits for Child Care
State Dependent Care Tax Credit -- model legislation for state dependent care tax credits, including making it refundable with broad income eligibility.


National Womens Law Center,Child Care Assistance Policies 2005:States Fail to Make Up Lost Ground, Families Continue to Lack Critical Supports

Creating Quality Child Care

CPA, Smart Child Care Act -- model legislation based on North Carolina's Smart Start program to create public-private partnerships to provide high-quality childcare.
Wyoming HB 92 -- public-private partnership to develop quality child care facilities across the state.
CLASP, Untapped Potential? -- outlines how states can increase the supply of child care and improve the quality of child care program standards and services.
Urban Institute, More than a Work Support? Issues Around Integrating Child Development Goals into the Child Care Subsidy System -- emphasizes how to strengthen the quality and educational components of child care.

Urban Institute, More than a Work Support? Issues Around Integrating Child Development Goals into the Child Care Subsidy System -- explains how to strengthen the quality and educational components of child care.
National Womens Law Center, How to Use the Military Model to Improve Child Care in Your State -- outlines how to use the availability of military day care as a "hook" to promote better child care systems.

Collective Bargaining Rights for Child Care Workers
NY A10060 -- New York bill to give child care workers collective bargaining rights
WA HB 2353 -- Washington State law giving child care workers collective bargaining rights
IL Executive Order on Collective Negotiation by Day Care Home Providers
National Women's Law Center, Fact Sheet-Child Care Providers: Increasing Compensation

Raises Women's Wages and Improves Child Care Quality

Economic Opportunity Institute, Early Childhood Education Career and Wage Ladder
SEIU Child Care and Head Start Workers
AFSCME Child Care Providers Together
United Federation of Teachers Family Child Care Providers

Eye on the Right

Some call it Karma. The Colorado state senator who stepped up the attacks on immigrants by tightening rules for getting driver's licenses just got his own family gobsmacked in the process. His fifteen-year-old daughter is having trouble getting her license, because a passport is no longer sufficient identification unless accompanied by a birth certificate or Social Security card. The senator responsible for these new rules is now decrying the fact that the rules are changing. Brilliant.

Outrages of the Week

Kansas's AG encourages pastors to use their pulpits politically, Colorado's Governor connected to conspicuous corporate cash laundering?, Blackwell sued for violating motor voter, and more.

Check it out in the latest Outrages of the Week.

Upcoming Events

Oct. 17, 2006 - Progressive States Luncheon Featuring Jonathan Miller -- Miller, the State Treasurer of Kentucky, has a new book, The Compassionate Community: Ten Values to Unite America. As a religious progressive in the South, Miller promotes an innovative way to combine progressive values and a faith-based politics that cuts across religious lines. Progressive States is proud to host him for a luncheon. Details

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Matt Singer
Editor, Stateside Dispatch


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