Wealthy Maryland is poor in child-care subsidies

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By Josh Hicks

 

January 2, 2016

 

A group of Maryland lawmakers is pushing Gov. Larry Hogan and the General Assembly to increase financial assistance for families struggling to cover child-care costs, noting that the state ranks among the least generous in the nation for such aid.

Advocates say state and federal funding levels for child-care subsidies are too low, forcing Maryland to restrict how many low-income families qualify for vouchers and greatly limiting which day-care centers those families can afford.

Adding to the financial pressure are new federal regulations that say states must subsidize child care at rates that allow parents to enroll their children in higher-priced programs, rather than only the cheapest.

Del. Ariana B. Kelly (D-Montgomery) and Sen. Nancy J. King (D-Montgomery), who chair a legislative committee that oversees child care in the state, want Hogan (R) to increase funding for subsidies and work with the panel to come up with tax proposals that would ease the financial burden of child care for families and providers.

They say Maryland, which has the highest median income in the nation, should be able to afford the extra costs.

Hogan has increased state spending on the subsidy program by 8 percent since taking office, to about $40.8 million for fiscal year 2017. He has not said whether he will boost funding or the program in his next budget proposal, which he must release next month.

Amelia Chasse, a spokeswoman for the governor, said the child-care program will “remain a strong focus going forward” and that “caring for the most vulnerable among us, especially our children, will always be a top priority of the Hogan administration.”

 Advocates say affordable, quality child care helps with youth development and enables more parents to hold jobs and attend school. The federal subsidy program began under a welfare overhaul that Congress and President Bill Clinton approved in 1996, aimed in part at helping those who use government assistance become self-sufficient. 

Maryland’s subsidy program served more than 10,300 families and 17,400 children on average each month in 2015, according to the latest U.S. Department of Health and Human Services data.

Among them was Monique Burton, a 26-year-old Hyattsville resident with two children, ages 2 and 6. Burton works part time for Prince George’s County schools and attends Prince George’s Community College.

“Making minimum wage wasn’t what I wanted to be, so I decided to go back to school to better myself,” Burton said. “It could mean coming off assistance from the government and making me and my kids better off.”

The new federal guidelines say state subsidies should be generous enough to allow those who receive them to afford the cost of child care at 75 percent of providers in their communities. Maryland’s rates cover enrollment costs for only 9 percent of providers, according to the state Department of Education, the lead agency for the subsidy program. 

Clinton Macsherry of the Maryland Family Network, an advocacy group that also manages the state’s network of child-care resource centers, said the size of the subsidies “relegate[s] low-income families to the cheapest and poorest quality of child care in their areas.”

Federal officials warned the state’s education department in a June letter that they plan to monitor more closely which states comply with the new guidelines. “Your rates may not allow for equal access,” the letter said.

The National Women’s Law Center, which produces an annual report on child-care assistance in each state, found that Maryland also has the nation’s lowest income threshold for parents to qualify for subsidies, meaning only the poorest families receive them. 

A family of three in the state must earn no more than $29,990, or 33 percent of the state median income for a household of that size, to qualify for a subsidy. By comparison, the District of Columbia’s income limit is 65 percent of its median income for a three-person household, Pennsylvania’s is 57 percent, Delaware’s is 56 percent, and West Virginia’s is 52 percent.

Nicole Fontz, 36, a preschool teacher and single mother of two from Pasadena, Md., will be ineligible for subsidies next year because a raise put her above the state’s income threshold. Her children, ages 7 and 9, use before- and after-school care at the center where she works.

“At times, I almost wish I didn’t have the raise,” she said. “I need the extra money, but I didn’t realize I’d be making $700 too much for the subsidy.”

Fontz said she has worked out an arrangement with her employer to pay a discounted rate for her children’s care while she figures out how to cover the full amount.

Maryland hasn’t adjusted its income limits for subsidies since 2002. Since 2011, the state has also halted enrollment for families who are at the top qualifying income levels — with exceptions for some children, such as those with special needs. Nearly 4,000 children whose family income should qualify them for subsidies were on the wait list as of November, according to state data.

Additional funding pressure will come from a new federal rule that requires state child-care vouchers to last a full year, an increase from the current standard of up to six months. The goal is to reduce the frequency of disruptions in care, although Macsherry noted that in some cases families only need the subsidies for shorter periods.

The Joint Committee on Children, Youth and Families, which Kelly and King chair, has held four hearings on child-care assistance since April. The lawmakers say they have strong support for increasing subsidies from committee members Ana Sol Gutierrez (D-Montgomery), Alonzo T. Washington (D-Prince George’s) and Mary L. Washington (D-Baltimore).

Beyond pushing Hogan to include more funding in his budget, Kelly said members of her committee plan to introduce child-care legislation that could include plans for extending the state’s child-care tax credit to families that earn more than $50,000; making credits refundable so people who don’t earn enough money to pay taxes would receive a check from the government; and providing tax breaks for child-care providers and workers.

The panel is also considering a measure that would require a biannual report from the state education department on the market rates for child care and the estimated cost of boosting subsidies to cover care from 75 percent of providers.

But some lawmakers, particularly Republicans and those representing more rural parts of the state, say they are not enthusiastic about increasing child-care aid.

“There has been no one in my district who has talked to me about that issue,” said Del. Gail H. Bates (R-Howard), who is a member of the joint committee.

Del. Kathryn L. Afzali (R-Frederick), who also sits on the joint committee, cited Hogan’s request that GOP lawmakers not support any legislation that calls for additional spending.

“If it’s a tax break, it comes out of the budget, and that means something else has to give,” Afzali said. “Anything that’s going to cost the state more money, I’m probably not going to support.”

For Kelly, the matter is personal, having grown up in a family that relied on child-care subsidies while her parents were working and going to college.

“My mom made me promise when I was elected that I’d protect that program,” she said. “Maryland is one of the worst in the nation. . . . I know we can do better.”

 

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