Day care assistance funds drying up as need deepens

hduncan@macon.comAugust 23, 2010 

  • Helpful websites to learn more about child care

    - Parents and the High Cost of Child Care, 2010 update, by the National Association of Child Care Resource and Referral Agencies:
    Includes state rankings on affordability, and state-by-state comparisons of urban and rural costs, day care compared with the cost of housing and college tuition, etc.

    - Georgia Budget and Policy Institute:
    Features fairly technical reports on state budget cuts to child care subsidies and other programs intended to help the poor.

    - To learn more about subsidies through Georgia’s Children and Family Services (CAPS) program, visit:
    You can find a list of local Division of Family and Children Services offices where you may apply, and/or Click on “How do I… Apply for subsidized child care assistance” in the left-hand column.
  • To learn more

    Georgia families can learn more about child care subsidies available by calling (877) ALL-GA-KIDS or by visiting their local DFACS office, where parents may fill out applications.

For parents such as Vanita Adams, government help with day care costs made the difference between employment and welfare.

Adams, who works as a parent aide for the Macon-Bibb Equal Opportunity Council, received a state subsidy to help her send her two sons to after-school care for about a year.

“I was separated when it started, and becoming a one-income household was very hard,” she said. Her divorce was eliminating some of the child care help she had received from family members at the same time she lost income through furloughs.

“Without the help, I probably would have been out of a job,” Adams said.

Her plight is common. A quarter of Georgia children younger than age 5 receive some kind of subsidized child care, according to a 2010 report by the Georgia Budget & Policy Institute. And since the recession, demand is higher than ever, child care advocates say.

In 2009, a two-parent family living at the poverty line would have to spend about half its income to afford placing a baby in a day care center, according to a report by the National Association of Child Care Resource and Referral Agencies.

A recent stimulus program expanded day care subsidy options. But that money is scheduled to dry up next month. In the meantime, Georgia has reduced funding for its ongoing day care assistance program.

Even before the recession, one in five Georgia children was living below the federal poverty level, according to 2007 U.S. Census figures.

In Bibb County, the number is even higher: Almost a third of children live below the poverty level, according to University of Georgia statistics.

The situation may have worsened as many people lost jobs or work hours, including many who had never received any kind of public assistance before and may not know day care help is available.

Research has shown that child care subsidies make a big difference in reducing unemployment.

For example, a 2002 Georgia study published in Early Childhood Research Quarterly compared families receiving child care subsidies with similar families waiting to receive a subsidy. It found that mothers receiving subsidies were more likely to be employed, spent half as much of their income on child care and were less likely to be very poor. Their children were more likely to be in a licensed center and have stable care.

Georgia limits eligibility for child care assistance more than most states. And because Georgia hasn’t updated its income limits since 2005, families could lose their subsidies just because their incomes are keeping pace with inflation, according to a recent Georgia Budget & Policy Institute report.

Plus, the subsidy covers only a portion of child care costs. Parents must provide a co-payment, plus make up any difference between what the state pays and what day cares charge. A 2007 survey by the National Women’s Law Center showed that among its neighbors, Georgia requires the highest co-payment from parents.

For a family at the federal poverty level, the co-payment is $123 a month, according to the Georgia Budget & Policy Institute.

A co-payment may be less than $20 a week, but even a $5 difference can be enough to shut out this kind of customer, said Scott Cotter, president and CEO of the Columbus-based Child Care Network chain. “I would lose a lot of subsidized families over $5,” he said.

This generally drives the poor to the very cheapest — and often lowest performing — day cares, said Carolyn Salvador, executive director of the Georgia Child Care Association.

“Some just can’t afford the co-pay,” said Marjorie Almand, director of the Bibb County Department of Children Services. “So it’s literally you leave your kid alone and work, or you starve.”

Available subsidy programs

Federal child care subsidies from a Child Care and Development Fund block grant and Temporary Assistance for Needy Families (TANF) are funneled through the Georgia Department of Human Resources.

Together they are distributed through Georgia’s Child Care and Parent Services (CAPS) program to improve day care access for low-income parents who are searching for a job, receiving training or working at least 24 hours a week. The number of required hours was reduced from 30 at the beginning of 2009.

Starting in September 2009 and ending Sept. 30 this year, Georgia also used stimulus funding to offer limited-time day care assistance to parents with higher incomes while they attended school or college. Only 15 work hours a week were required.

Families could not enroll in both the stimulus program and CAPS, Almand said.

Before the stimulus program, some Georgia counties had long waiting lists of families eligible for day care subsidies (although Almand said Bibb County has not had a waiting list for several years). The stimulus funds eliminated those waiting lists in most areas, said Clare Richie, a senior policy analyst for the Georgia Budget & Policy Institute. The program is helping the state provide some kind of day care subsidy to about 62,000 children a month, “which is really good when it had been 54,000,” she said.

The question is what happens when the money runs out.

“We’re urging the state to budget more funding so (recipients of the stimulus child care assistance) would continue getting their child care,” said Roberta Malavenda, vice president for policy with the Georgia Association on Young Children. “The hope is they’ll continue to receive their subsidy, but we don’t know.”

Richie said she hasn’t been able to get a response about the state’s plans.

“Clearly, the demand is there,” she said. “When you take funding away, will parents be able to keep working, or will children be in an unsafe situation?”

Dena Smith, press secretary for the Department of Human Services, did not return repeated phone calls and e-mails over a period of weeks regarding what the state intends or answer any questions about state subsidy funding or day care reimbursements.

Cotter, who is also vice president of legal and legislative affairs for the Georgia Child Care Association, said state officials have told him the Department of Human Resources has the money to transfer eligible families from the stimulus program into CAPS at the end of September.

However, some families receiving stimulus funds wouldn’t be eligible because of the lower income limit.

Temporary Assistance for Needy Families

The federal government didn’t allow states to use stimulus money to replace state funding, but it could substitute for federal funds. Georgia used the stimulus as an opportunity to divert federal TANF funding away from its primary purpose, promoting employment and marriage. Instead, the money was used to plug underfunded state programs such as adoption and child welfare services.

That left just $600,000 of TANF money for child care subsidies for fiscal 2010 and 2011, respectively. The stimulus funds made up the $11.5 million difference between the state budget and the actual cost.

According to the Georgia Budget & Policy Institute, this shifting was happening even before the recession caused a state budget crunch. Between 2002 and 2008, Georgia decreased the number of children receiving TANF benefits for child care and other purposes by 66 percent. Yet during the same period, the number of Georgia families living in poverty increased by about 26 percent.

Although the number of poor families is believed to have increased since the recession, state lawmakers budgeted only 40 percent of the state’s TANF 2011 block grant for programs that directly help families escape poverty, Richie said.

Congress is now considering a big boost to the Child Care Development block grant that provides the majority of federal day care subsidies. This could offset the loss of the stimulus boost.

But the state must provide a match for the block grant.

“The bigger question is looking at the what the state match will be, and whether Georgia will commit the funds to draw down that money,” said Pam Tatum, CEO of the nonprofit Quality Care for Children.

Richie and Cotter said other states have targeted more of their TANF money for child care subsidies.

“Their legislatures get that this is a work support,” Richie. “If you think that the solution to poverty is employment, you might want to help people that are working.”

To contact writer S. Heather Duncan, call 744-4225.

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