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Journal Issue: The Next Generation of Antipoverty Policies Volume 17 Number 2 Fall 2007

Next Steps for Federal Child Care Policy
Mark H. Greenberg

Endnotes

  1. In this article, “low-income” refers to having income below 200 percent of the official poverty line, and “poor” refers to having income below 100 percent of the poverty line. In 2005, among the 13.5 million families with related children under age eighteen and incomes below 200 percent of poverty, 84 percent reported some work during the year, and 56 percent had at least one full-time year-round worker. Analysis drawn from U.S. Bureau of the Census, Current Population Survey, Families with Related Children under 18 by Number of Working Family Members and Family Structure, 2005, Annual Demographic Survey, Annual Social and Economic Supplement POV07 (2006), pubdb3.census.gov/macro/032006/pov/ new07_200_01.htm (August 31, 2006).
  2. In 2005, among the 5.7 million poor families with related children under eighteen, 68 percent reported some work during the year and 30 percent had at least one full-time year-round worker. Analysis drawn from Bureau of the Census, Current Population Survey (see note 1).
  3. The share of poor children with a full-time, year-round working parent grew from 19.9 percent in 1992 to 35.4 percent in 2000; the share was 32.1 percent in 2005. Velma W. Burke, Thomas Gabe, and Gene Falk, Children in Poverty: Profile, Trends and Issues, Report for Congress RL32682 (Congressional Research Service, updated January 16, 2007).
  4. In 2002, according to the Survey of Income and Program Participation (SIPP), among working families with employed mothers and children under age fifteen, 28 percent of low-income families paid for care, compared with 39 percent of families that were not low-income. Among those paying for care, low-income families paid an average of $68 a week, representing 15 percent of their incomes; in contrast, higherincome families paid $104, representing only 6.5 percent of their incomes. U.S. Bureau of the Census, Who’s Minding the Kids? Child Care Arrangements: Winter 2002 (October 2005); and detailed tables available at www.census.gov/population/www/socdemo/child/ppl-177.html (August 3, 2006). For concerns and cautions about the use of SIPP child care data, see Douglas J. Besharov, Jeffrey S. Morrow, and Anne Fengyan Shi, “Child Care Data in the Survey of Income and Program Participation (SIPP): Inaccuracies and Corrections” (Welfare Reform Academy, University of Maryland, 2006). Data from the 1999 National Survey of America’s Families (NSAF) show higher percentages of families paying for care than those from SIPP; like SIPP, they show that lower-income families pay less, but a higher share of their incomes, for care. According to 1999 NSAF data, 42 percent of low-income families paid for child care, compared with 51 percent of higher-income families. Low-income families paid an average of $53.54 weekly, representing 14 percent of their incomes; in contrast, higher-income families paid $76.38, representing only 7 percent of their incomes. Among the 38 percent of poor families with child care expenses, the average expense was $52.39 a week, an average of 18 percent of parental earnings. See Linda Giannerelli, Sarah Adelman, and Stephanie Schmidt, Getting Help with Child Care Expenses (Washington: Urban Institute, 2003).
  5. See National Center for Education Statistics, Child Care and Early Education Arrangements of Infants, Toddlers, and Preschoolers: 2001 (U.S. Department of Education, November 2005), table 6-B.
  6. Assistant Secretary for Planning and Evaluation, Office of Human Services, “Child Care Eligibility and Enrollment Estimates for Fiscal Year 2003,” Policy Issue Brief (April 2005).
  7. U.S. Department of Health and Human Services News, New Statistics Show Only Small Percentage of Families Receive Child Care Help (December 6, 2000); Jennifer Mezey, Mark Greenberg, and Rachel Schumacher, The Vast Majority of Federally-Eligible Children Did Not Receive Child Care Assistance in FY 2000 (Washington: Center for Law and Social Policy, 2002).
  8. See studies summarized in Hannah Matthews, Child Care Assistance Helps Families Work: A Review of the Effects of Subsidy Receipt on Employment (Washington: Center for Law and Social Policy, 2006).
  9. Stephanie A. Schaefer, J. Lee Kreader, and Ann M. Collins, Parent Employment and the Use of Child Care Subsidies: Literature Review (Child Care and Early Education Research Connections, April 2006). See also David Blau, “Child Care Subsidy Programs,” in Means-Tested Transfer Programs in the United States, edited by Robert A. Moffitt (University of Chicago Press and National Bureau of Economic Research, 2003), pp. 443–516; Rachel Connelly and Jean Kimmel, The Effect of Child Care Costs on the Labor Force Participation and Welfare Recipiency of Single Mothers: Implications for Welfare Reform (Kalamazoo, Mich.: W. E. Upjohn Institute, rev. March 2001); Matthews, Child Care Assistance (see note 8).
  10. Isabel Sawhill and Adam Thomas, A Hand Up for the Bottom Third: Toward a New Agenda for Low- Income Working Families (Brookings, May 2001).
  11. National Academies, Working Families and Growing Kids (Washington, 2003), p. 135, and p. 64, citing Joan Lombardi, Time to Care: Redesigning Child Care to Promote Education, Support Families, and Build Communities (Temple University, 2003).
  12. National Academies, Working Families and Growing Kids (see note 11), p. 4.
  13. For an overview of determinants of child care quality, see J. Lee Kreader, Daniel Ferguson, and Sharmila Lawrence, Infant and Toddler Child Care Quality, Research-to-Policy Connections 2 (New York: National Center for Children in Poverty, August 2005). For more on why higher-quality care tends to be more expensive and out of the reach of lower-income families, see Linda Giannerelli and James Barsimantov, Child Care Expenses of America’s Families (Washington: Urban Institute, 2000); Karen Schulman and Gina Adams, The High Cost of Child Care Puts Quality Care out of Reach for Many Families (Washington: Children’s Defense Fund, 1998); and National Academies, Working Families and Growing Kids (see note 11), pp. 56–63. Accredited child care facilities often “can cost as much as $5,000 more a year than nonaccredited care”; National Association of Child Care Resource and Referral Agencies (NACCRRA), Breaking the Piggy Bank: Parents and the High Price of Child Care (Arlington, Va., 2006).
  14. In one set of recent focus groups, more than two-thirds of parents mentioned cost as a primary concern when choosing child care arrangements; NACCRRA, Breaking the Piggy Bank (see note 13).
  15. Ellen S. Peisner-Feinberg and others, The Children of the Cost, Quality, and Outcomes Study Go to School: Executive Summary (University of North Carolina at Chapel Hill, June 1999). For an overview of research on the effects of quality early child care on children, including upon entering school, see National Academies, Working Families and Growing Kids (see note 11), pp. 105–22.
  16. Deborah Lowe Vandell and Barbara Wolfe, Child Care Quality: Does It Matter and Does It Need to Be Improved? (University of Wisconsin, Institute for Research on Poverty, November 2000).
  17. Peisner-Feinberg and others, The Children of the Cost, Quality, and Outcomes Study Go to School (see note 15).
  18. National Academies, Working Families and Growing Kids (see note 11), p. 134.
  19. On the benefits to poor children, see E. S. Peisner-Feinberg and others, The Children of the Cost, Quality, and Outcomes Study Go to School (see note 15). A British study of preschool attendance found that “for the most disadvantaged groups . . . the experience of longer duration and higher quality is likely to be particularly important in reducing the social class attainment gap, although it can be seen that all SES groups show significant benefit from attending pre-school in relation to attainment in Reading and Mathematics.” Kathy Sylva and others, Social Class Differences in the Effects of Pre-School on Children’s Academic Performance at Age 7 (University of London, November 2005).
  20. Jeffrey Capizzano and Gina Adams, Children in Low-Income Families Are Less Likely to Be in Center- Based Child Care (Washington: Urban Institute, November 2003). Also, lower-income employed mothers with children from birth to age five are less likely to use child care centers than higher-income mothers. National Academies, Working Families and Growing Kids (see note 11), p. 44. Fifty eight percent of children receiving Child Care and Development Fund subsidies participate in center-based care arrangements. U.S. Department of Health and Human Services, “FFY 2005 CCDF Data Tables (Preliminary Estimates),” www.acf.hhs.gov/programs/ccb/data/ccdf_data/05acf800/table3.htm. A study comparing children receiving subsidies for child care with those on waiting lists found that the former were more likely to be in a formal licensed child care center. It also found that subsidies for low-income mothers seem to result in “more stable care, ease of finding care, and satisfaction with care [which] suggest that subsidy mothers were less psychologically stressed about child care issues compared to mothers on waiting lists.” Fred Brooks, “Impacts of Child Care Subsidies on Family and Child Well-Being,” Early Childhood Research Quarterly 17 (2002): 498–511.
  21. The Government Accountability Office (GAO) has reported that “sixty-nine federal programs provided or supported education and care for children under age 5 in fiscal year 1999.” However, the GAO found that of $9 billion in nontax spending identified in its report, $8 billion came from three sources: the Child Care and Development Block Grant, the Temporary Assistance for Needy Families Block Grant, and the Head Start Program. U.S. Government Accountability Office, Early Education and Care: Overlap Indicates Need to Assess Crosscutting Programs, GAO/HEHS-00-78 (April 2000); for an update finding that the number of programs remained at sixty-nine in 2005, see U.S. Government Accountability Office, Update on Prekindergarten Care and Education Programs, GAO-05-678R (June 2, 2005). Although the present article emphasizes the importance of coordinating Head Start and child care, it does not treat Head Start as a federal child care program, since the principal purpose of Head Start is to promote the school readiness of low-income children without regard to their parents’ work status or need for child care.
  22. Office of Management and Budget, Analytical Perspectives, Budget of the United States of America, Fiscal Year 2007 (2006).
  23. Leonard Burman, Elaine Maag, and Jeffrey Rohaly, Tax Subsidies to Help Low-Income Families Pay for Child Care (Washington: Urban-Brookings Tax Policy Center, June 2005).
  24. Office of Management and Budget, Analytical Perspectives (see note 22).
  25. Another small ($10 million) provision lets employers claim a tax credit of up to 25 percent of qualified expenses for employee child care and 10 percent of qualified expenses for child care resource and referral services, up to $150,000 a year.
  26. Mark Greenberg, Joan Lombardi, and Rachel Schumacher, The Child Care and Development Fund: An Overview (Washington: Center for Law and Social Policy, June 2000).
  27. Annual federal CCDF funding (not counting transferred TANF funds) grew from $2.2 billion in 1996 to $4.8 billion in 2002 but then remained flat until it was increased to $5 billion in the Deficit Reduction Act of 2005. Combined TANF transfers and direct spending peaked at $4 billion in 2000 and declined to $3.2 billion in 2005. Hannah Matthews and Danielle Ewen, Child Care Assistance in 2004: States Have Fewer Funds for Child Care (Washington: Center for Law and Social Policy, 2005); analysis of FY 2005 CCDF and TANF use of funds by Center for Law and Social Policy.
  28. Burman, Maag, and Rohaly, Tax Subsidies to Help Low-Income Families (see note 23).
  29. U.S. Government Accountability Office, Child Care: Recent State Policy Changes Affecting the Availability of Assistance for Low-Income Families, GAO 03-588 (May 2003); U.S. Government Accountability Office, Child Care: Additional Information Is Needed on Working Families Receiving Subsidies, GAO-05-667 (June 2005).
  30. Except as noted, data on cross-state policy variation are drawn from Karen Schulman and Helen Blank, State Child Care Assistance Policies 2006: Gaps Remain, with New Challenges Ahead (Washington: National Women’s Law Center, September 2006).
  31. Child Care Bureau, “FY 2005 CCDF Data Tables, Preliminary Estimates,” table 17, www.acf.hhs.gov/programs/ ccb/data/ccdf_data/05acf800/table17.htm.
  32. H. M. Treasury, Pre-Budget Report 2003: The Strength to Take the Long-Term Decisions for Britain: Seizing the Opportunities of the Global Recovery (London, 2003).
  33. Burman, Maag, and Rohaly, Tax Subsidies to Help Low-Income Families (see note 23).
  34. See H. M. Treasury, Choice for Parents, the Best Start for Children: A Ten Year Strategy for Childcare (London, December 2004).
  35. Child Care Bureau, “FY 2005 CCDF Data Tables, Preliminary Estimates,” table 15, www.acf.hhs.gov/programs/ ccb/data/ccdf_data/05acf800/table15.htm.
  36. NACCRRA, Breaking the Piggy Bank (see note 13).
  37. See, for example, Lily L. Batchelder, Fred L., Goldberg Jr., and Peter Orszag, Reforming Tax Incentives into Uniform Refundable Tax Credits (Brookings, August 2006).
  38. See National Child Care Information Center, “Child Care and Development Fund Report of State Plans FY 2006–2007,” sec. 3.5.3, www.nccic.org/pubs/stateplan2006-07/part3.pdf.
  39. See discussion in Gina Adams and Monica Rohacek, “More than a Work Support? Issues around Integrating Child Development Goals into the Child Care Subsidy System,” Early Childhood Research Quarterly 17 (2002): 418–40.
  40. Child Care Bureau, Quality Rating Systems and the Impact on Quality in Early Care and Education Settings (U.S. Department of Health and Human Services, 2005); National Child Care Information Center, Quality Rating Systems and the Impact on Quality in Early Care and Education Settings (Fairfax, Va., November 2006).
  41. In 2005 states spent a reported $920 million on a range of program quality activities. See U.S. Department of Health and Human Services, “2005 CCDF State Expenditure Data,” www.acf.hhs.gov/programs/ccb/ data/expenditures/05acf696/fy05_overview_allyears.htm.
  42. Under current law, in addition to providing subsidies, states can use child care block grant dollars for activities to provide consumer education, increase parental choice, and improve the quality and availability of child care. Activities can include resource and referral efforts, helping providers meet health and safety and other standards, improving the monitoring of compliance with and enforcement of standards, providing training and technical assistance to providers, and improving salaries and other compensation for child care staff. Code of Federal Regulations, vol. 45, sec. 98.51. There is an additional set of earmarked qualityrelated funds.
  43. Janet Gornick and Marcia Meyers, Families That Work: Policies for Reconciling Parenthood and Employment (New York: Russell Sage Foundation, 2003).
  44. Administration for Children and Families, Preliminary Findings from the Early Head Start Prekindergarten Follow-Up (U.S. Department of Health and Human Services, April 2006).
  45. W. Steve Barnett and others, The State of Preschool: 2005 State Preschool Yearbook (National Institute for Early Education Research, 2005).
  46. Afterschool Alliance, 21st Century Community Learning Centers: A Foundation for Progress (2006).
  47. The recommendation is described in Center for American Progress Task Force on Poverty, From Poverty to Prosperity: A National Strategy to Cut Poverty in Half (Washington, 2007). The details of the Urban Institute’s modeling are presented in Linda Giannerelli, Laura Wheaton, and Joyce Morton, Estimating the Anti-Poverty Effects of Changes in Taxes and Benefits with TRIM3 (Washington: Urban Institute, 2007).
  48. The research finds positive effects of child care subsidies on employment, but does not provide a consistent picture of the size of the effect. See, for example, Erdal Tekin, “Child Care Subsidies, Wages, and Employment of Single Mothers” (Georgia State University, August 2005), which finds that a 50 percent reduction in the cost of child care would result in a 3.8 percentage point increase, and 5.4 percent increase, in employment among single mothers; Bong Joo Lee and others, Child Care Subsidy Use and Employment Outcomes of TANF Mothers during the Early Years of Welfare Reform: A Three-State Study (Chapin Hall Center for Children at the University of Chicago, September 2004), which finds that among single mothers who were receiving TANF or who had recently left TANF during the early years of welfare reform (1997–99), child care subsidies increased employment retention over a two-year study period by 25 to 43 percent, depending on the state; Sandra K. Danziger, Elizabeth Oltmans Ananat, and Kimberly G. Browning, “Child Care Subsidies and the Transition from Welfare to Work,” Working Paper 03-11 (National Poverty Center, 2003), which finds that families leaving welfare with child care subsidies had twice as many months of work as those who had not used care and nearly 15 percent more than those who used unsubsidized care; Fred Brooks and others, “Impacts of Child Care Subsidies on Family and Child Well-Being,” Early Childhood Research Quarterly 17 (2002): 498–511, which compares subsidy recipients among the working poor with those on a waiting list, controlling for numerous factors, and finds an 18 percentage point difference in employment rates among the two groups just a few months after applying for subsidies; David Blau and Erdal Tekin, “The Determinants and Consequences of Child Care Subsidy Receipt by Low-Income Families,” in The Incentives of Government Programs and the Well-Being of Families, edited by Bruce Meyer and Greg Duncan (Chicago and Evanston, Ill.: Joint Center for Poverty Research, January 2001), which calculates that among single mothers with a child under age thirteen, “subsidy recipients were about 2.5 percentage points more likely to be employed than nonrecipients, and about 5 percentage points more likely to be employed after controlling for a small set of family characteristics.”
  49. Rachel Schumacher and others, All Together Now: State Experiences in Using Community-Based Child Care to Provide Prekindergarten (Washington: Center for Law and Social Policy, 2005).
  50. For an examination of the relationship between subsidy phase-outs and tax credit phase-ins based on the law and policies in effect at that time, see Thomas Gabe, Bob Lyke, and Karen Spar, Child Care Subsidies: Federal Grants and Tax Benefits for Working Families, Report for Congress RL30081 (Congresional Research Service, 1999).