The Biden-Harris Administration has recently appealed to Congress for an additional $16 billion in funding to support the childcare sector. This request comes after the expiration of the pandemic childcare stabilization fund on September 30.
Emergency Supplemental Funding Request
Part of a larger emergency supplemental-funding request, the administration is seeking approximately $55 billion in funding to address various domestic crises. Alongside the childcare sector, this proposal includes funding requests for disaster response programs, affordable high-speed internet, energy assistance, and efforts against fentanyl.
Extending Childcare-Stabilization Funding
The core focus of the request is to extend the childcare-stabilization funding for an additional year. By doing so, the administration hopes to assist in keeping childcare providers financially stable. This extension aims to mitigate the risk of providers closing down or raising costs for families.
The "Child-Care" Cliff
On September 30, the United States reached a critical point in childcare funding, referred to as the "child-care" cliff. At this juncture, the government's $24 billion funding allocated to child-care providers under the 2021 American Rescue Plan expired. Consequently, many centers faced challenges in retaining workers and covering essential expenses like rent and utilities.
Future Challenges for Childcare Providers
Moving forward, offering affordable childcare may become increasingly difficult for providers, a burden that parents already struggle with. Lack of additional funding has forced providers to make tough decisions such as employee layoffs or program closures.
While several states have enacted legislation to provide more financial support for child care in the past year, advocates and providers express that nothing can replace the lost federal funding.
The Impact of Expired Pandemic-Era Funding on Child Care
Child-care centers and programs in various states, including Pennsylvania and Wisconsin, have unfortunately been forced to shut down. This concerning development was highlighted by Julie Kashen, the director of women's economic justice at the Century Foundation, a reputable think tank in New York known for its left-leaning stance. With the sector already facing challenges in finding qualified child-care workers, the situation is becoming increasingly precarious.
In western North Carolina, the Southwestern Child Development Commission—an esteemed nonprofit organization dedicated to early education—recently made the difficult decision to close seven of its agency-operated programs. As of October 31, these programs will cease to operate. The announcement cited a lack of sufficient resources from the agency to complement the state rate as the primary reason behind this heartbreaking decision. Despite raising tuition rates on October 1, the new rates provided little relief to the rural counties where these vital programs were located.
According to Kashen, the United States has effectively plummeted off the child care cliff—a sudden end to the federal funds that previously provided stability to the sector. In a statement, Kashen emphasized the urgent need for Congress to pass emergency funding, as outlined in the Administration's supplemental budget request. This funding is essential not only for the well-being of children and families, but also for maintaining a strong labor market and promoting economic prosperity that stems from investing in care.
The rising cost of childcare is placing an unbearable burden on parents. Explore our calculator tool to track childcare expenses in your area.
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