Federal Update: July 2023

A lot has happened in the nation’s capital related to early education since our last federal update back in March. This federal update will focus on two of the most important recent developments when it comes to the federal government and early education: the Biden administration’s recent executive actions related to child care and the ongoing battle to determine funding levels for the government prior to the September 30 deadline.

Executive Actions on Child Care

On April 18, President Biden signed an executive order that directs federal agencies to take action to make child and elder care cheaper and more accessible, representing the most comprehensive set of executive actions any president has taken to improve the country’s care infrastructure. We have a full summary of the details of the executive order here. Among other things, the order directs the Secretary of Health and Human Services (HHS) to consider actions to reduce child care costs for the 1.5 million children and their families benefiting from the Child Care and Development Block Grant (CCDBG) each month. An accompanying fact sheet specified that these actions could include reducing or eliminating child care co-payments.

Less than three months later, Vice President Harris detailed the administration’s latest actions related to the executive order when she announced new steps to lower the cost of child care by strengthening CCDBG. Specifically, the Vice President announced an HHS notice of proposed rulemaking (NPRM) that would make a number of impactful changes, such as ensuring that providers are paid on-time and based on program enrollment rather than attendance, capping child care copayments for working families at seven percent of a family’s income, encouraging states to waive copayments for families at or below 150 percent of the federal poverty level, and taking steps to make it easier for families to access CCDBG. The NPRM includes several references to New America’s 2021 brief that detailed the benefits of paying providers based on enrollment rather than attendance as well as New America’s 2023 brief about fragmentation in early care and education programs. Written comments on the proposed rule are currently being accepted and are due by August 28.

Just a few days ago, the White House again reaffirmed its commitment to improving child care at a convening that included more than 90 state legislators from 41 states. At the convening, state leaders shared notable successes related to child care from recent legislative sessions. For example, Minnesota Lieutenant Governor Peggy Flanagan detailed the transformational investments the state recently made to improve its child care system. Overall, the legislative session resulted in about $750 million in new funds for child care and early learning programs throughout the state, as well as a child tax credit worth up to $1,750 per child for families with low incomes that is expected to cut child poverty in the state by one-third.

These recent actions offer another example of the Biden administration’s commitment to taking action to improve child care throughout the country, whether that be through encouraging legislative action or executive order. We’ll keep you updated on the latest developments related to the NPRM once the August deadline for written comments passes.

Government Funding

Appropriations season is heating up as lawmakers work to avoid a government shutdown that could occur as soon as October 1. Congress is facing a September 30 deadline to fund the government for the next fiscal year and the House and Senate are currently miles apart in reaching agreement on funding levels. House conservatives have pushed Speaker McCarthy to accept their demands of funding the government at FY2022 levels, despite those levels being $130 billion less than what was agreed to in the debt limit compromise reached with the White House in June. For their part, the Senate is marking up their bills to the levels mandated by the debt limit compromise, making an eventual clash between the House and Senate inevitable.

A bill recently advanced by a Republican-controlled House subcommittee illustrates just how far apart the two chambers are on funding levels. That bill proposes cutting Title I grants by 80 percent, a cut of almost $15 billion that would severely impact schools with high numbers of students from families with low incomes. It also proposes the elimination of Title II grants that provide professional development to teachers. When it comes to programs specifically related to early education, the news doesn’t get better: the bill proposes eliminating the Preschool Development Grant program as well as the Child Care Access Means Parents in Schools (CCAMPIS) program that provides grants to help low-income college students afford child care, while also cutting $750 million in funding for Head Start. While these proposed cuts are unlikely to become law, they highlight just how high the stakes are for children and families in the current budget fight.

While House Republicans are pushing for cuts to programs for young children, child care advocates are sounding the alarm about the upcoming expiration of American Rescue Plan Act (ARPA) stabilization dollars that helped save the sector from collapse during the height of the pandemic. According to a recent report from the Century Foundation, 3.2 million children could lose their child care spots if the funds are allowed to expire. A coalition of child care advocates recently released a fact sheet requesting an immediate investment of at least $16 billion per year to sustain the progress that’s been made as a result of the ARPA funding.

We’ll keep you updated on the latest news about efforts to ensure the long-term survival of the child care industry through federal investment that both immediately addresses the upcoming fiscal cliff and lays the groundwork for sustained funding to ensure that child care is accessible for all families.