Lawmakers, Governor propose solutions to child care crisis

Early education advocates and business leaders alike are sounding the alarm about the many Iowa families struggling to find and afford quality child care. At a January 13 subcommittee hearing on a bill that would expand child care assistance for low-wage families, every lobbyist present — including the Iowa Business Association and the Iowa Credit Union League — urged lawmakers’ support. And importantly, they also called on lawmakers to expand assistance even further, citing the direct link between families affording child care and being able to go to work.

The bill in question, HSB 2, would increase the exit eligibility level for Child Care Assistance Plus (a component of Iowa’s Child Care Assistance program) from 225 percent to 250 percent of the federal poverty level. That move would allow more families, once part of the CCA program, to continue to receive help paying for child care even as their income increases.

HSB 2 is welcomed but partial solution that leaves many families out. Legislators must also increase Iowa’s extremely low CCA entrance eligibility level — at 145 percent FPL, or $31,494 annually for a family of three, among the nation’s lowest. A family who applies with an income of even one penny over the threshold won’t qualify for help, even while another similar family with the same income receives help because they applied when their income was below the entrance cutoff—and later got a raise.

Getting more children into our CCA system is the first, best way to help families afford child care. Child care assistance is available everywhere in Iowa. Unlike other proposals we’re seeing this year, for business tax credits or public-private partnerships, it’s not dependent on what community you live in, where you work or whether you can afford to wait till the end of the year to get the help in the form of a tax refund. It is the backbone of our child care system.

This consensus among business leaders and the early education community is a reasoned response to the scale of the challenge Iowa families face finding and affording child care. We hope lawmakers listen.

We’re also following and weighing in on Governor Reynold’s child care priorities:

• Put $3 million into the Child Care Challenge Grant Program, a matching grant fund launched last year that funds construction, renovation and remodeling of child care facilities. This will help some local communities that have been working to acquire or remodel buildings to use for child care or to expand existing locations.

• Double the maximum net income amount for the Early Childhood Development and Child and Dependent Care tax credits from $45,000 to $90,000. Like many proposals at the legislature this session, this bill would offer only modest help, taking up resources that could better be used to help families through our child care assistance program.

• Convene a group to develop a child care strategic plan. Members would include the Iowa Business and Child Care Coalition, Iowa Workforce Development and Department of Human Services. We don’t need another strategic plan. Ask the advocates—we have solutions to offer. We have offered them in the past.

Governor Reynolds has also made recommendations for how to use one-time federal child care COVID relief dollars. She’s calling for $25 million for child care start up grants, $7 million for salary stipends for early child care and education professionals, and $38 million for monthly stipends to providers who accept CCA and to reimburse copayments for families in the program.  

Federal relief funds have played an important role in helping Iowa’s child care industry stay afloat during the pandemic, but It’s critical that providers and families understand this is one-time funding. State leaders will need to step up to meet ongoing needs when federal relief funds are done.