2015 Fiscal Year State Budget, NC Budget and Tax Center, Women and the Economy

New report reveals negative impact of legislative changes to child care policy and a better path forward

One of the most pressing concerns for any working family with children in North Carolina is to figure out a child care arrangement for children that allows parents to work and provide for their family, and allows children to learn and grow in a safe and stimulating setting when not in parental care. This is especially challenging because of the high cost of child care, as noted in these recently released state fact sheets by Child Care Aware of America. There are a few options available for families who earn low to moderate wages including the child care subsidy program which provides financial assistance to working families who need help paying for child care. Unfortunately this critical building block that makes life work for working families has been crumbling due to recent policy decisions by North Carolina lawmakers.

In our newest edition of Prosperity Watch, we feature a report released this month by NC Child detailing the impact made by child care subsidy policy changes passed by North Carolina lawmakers last year. These changes amounted to the loss of financial assistance for thousands of North Carolina families, including reducing income eligibility levels to qualify for the program, elimination of prorated fees for part-time child care (meaning many families will no longer be able to afford care), as well as counting income of a non-parent relative caregiver like a grandparent against the child’s eligibility for subsidies.

The map below provides a county by county breakdown of the more than 6,000 children who have lost or will lose access to child care subsidies from the change to the income eligibility provision alone.

PW 50-4

 

Both the House and Senate budget proposals address one or more of these changes, although neither returns to the previous eligibility levels meaning regardless of the provisions agreed upon in the final budget, there will be families who lose child care. One provision both chambers agree on is to stop counting non-parent relative caregiver income against eligibility for the subsidy program.  That is the only change in the Senate budget proposal, whereas the House applies the higher eligibility threshold for children ages 0-5 to children ages 6-8 as well, and also brings back the prorated parent fees for part-time care.

NC Child provides policy guidance in their report to use the higher income eligibility guideline for all children aged 0-13, to reinstate the prorated part-time co-pay rate and to exclude income of a nonparent relative caretaker. These recommendations will pave the way to a stronger child care subsidy system that supports working parents, children’s learning potential and the child care workforce.

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