Adopting 12-Month Subsidy Eligibility: Impacts on Children, Families, and State Child Care Programs
Oct 27, 2010 | Danielle Ewen and Hannah Matthews
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Child care costs are particularly burdensome for poor and low-income families, who pay a significantly higher share of their income for care than do upper-income families. For families struggling to find and retain employment, child care can be an obstacle that keeps them from economic success.
The Child Care and Development Block Grant (CCDBG, also known as the Child Care and Development Fund or CCDF) is designed to help families working, or in training or education, to receive assistance paying for child care. According to the most recent data, 92 percent of families receiving child care subsidies need help because parents are working or are in education or training programs.[i]
Children and families benefit when they have access to stable, continuous child care arrangements. Parents retain employment needed to support their families and young children benefit due to consistent care that fosters healthy development. During the current economic recession, consistent child care arrangements can provide a secure environment for young children whose families are struggling more than ever to make ends meet. High-quality child care helps children learn and develop skills they need to be successful in school and in life.
Although receiving a subsidy can help parents stay connected to the workforce and promote stable care for young children, research has found that the duration of subsidy use for recipients is often short.[ii] A multitude of factors, both internal and external to the subsidy system, likely affect subsidy duration. Contributing factors within the subsidy system are a state's eligibility redetermination and interim reporting policies.
Under federal CCDBG regulations, states have a great deal of flexibility in setting policies to promote access to child care assistance. Authorizing subsidies for longer periods can help families have sustained access to child care settings. Twenty-two (22) states currently set their maximum length of eligibility at 12 months.[i] In many cases, families are required to report changes, such as changes in employment or income that would impact their eligibility status between periods of redetermination. Failure to report can result in families losing their subsidy, depending on state rules.
A number of states are considering changing subsidy rules to allow for 12-month eligibility, and some have recently changed their policies. This is consistent with annual redetermination periods in other federal programs including Head Start and the Supplemental Nutrition Assistance Program (SNAP). This paper lays out the associated impacts of adopting an annual redetermination policy on children, parents, and state subsidy systems.
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[i] National Child Care Information and Technical Assistance Center, CCDF Eligibility Policies, http://nccic.acf.hhs.gov/poptopics/eligibility_policies.pdf.
[i]U.S. Department of Health and Human Services, Administration for Children and Families, Child Care Bureau, Child Care and Development Fund Preliminary Estimates: Reasons for Receiving Care, Average Monthly Percentage of Families (FFY 2008) http://www.acf.hhs.gov/programs/ccb/data/ccdf_data/08acf800_preliminary/table10.htm.
[ii] Marcia K. Meyers, et al, The Dynamics of Child Care Subsidy Use: A Collaborative Study of Five States, 2002, http://nccp.org/publications/pdf/text_484.pdf; Roberta Weber, Measurement of Child Care Arrangement Stability: A Review and Case Study Using Oregon Child Care Subsidy Data, Oregon State University, 2005.