Legislative committee discusses future of child care funding

by Jordan Hensley, LRC Public Information Office

FRANKFORT — It is no secret Kentucky’s child care industry struggled during the height of the COVID-19 pandemic. Federal American Rescue Plan Act (ARPA) funding came to the rescue, but a major portion of those funds will run out in September.

The Interim Joint Committee on Families and Children met Tuesday to discuss the future of child care funding in the state. Committee co-chair Sen. Danny Carroll, R-Benton, said the Kentucky General Assembly has a lot of consider going into the next budget cycle, which begins in 2024.

“You all know how crucial child care is coming into this next session,’ Carroll said. “I don’t know that there’s any one topic that is more important than that … There’s a lot of uncertainty on what the investment will need to be and how we can continue to grow centers throughout the commonwealth and sustain what we got.”

Ensuring quality child care is available across the commonwealth impacts the workforce and economy, Carroll said.

Andrea Day, who testified before the committee on Tuesday, said about 60% of Kentucky is considered a child care desert. Day is the division of child care director in the Department for Community Based Services (DCBS).

In 2021, Kentucky began receiving $470 million in ARPA funds to use as sustainability payments and $293 million for one-time child care and development block grants, Day said. By September, the sustainability payments will end. The block-grant funding will remain through September 2024.

Day said the ARPA funds have helped child care centers in Kentucky remain open and keep rates low for low-income Kentuckians. The block grant funding has been used to provide start-up grants, tuition support, facility updates and more.

Committee co-chair Rep. Samara Heavrin, R-Leitchfield, asked Day if the Cabinet for Health and Family Services planned to fund the sustainability payments once they run out. The General Assembly could possibly allocate funding in the next biennial budget, Heavrin said, even though she’s not sold on the idea.

“I think a lot of us here in the General Assembly are trying to figure out if it’s the government’s place to help with those sustainability payments. Because if it’s a broken system, how do we need to revamp that to help child care owners to be able to fix that?” Heavrin said.

Day said the cabinet has not made a decision.

Rep. Lisa Willner, D-Louisville, said she’s aware of child care providers who are “very concerned” about the end of the sustainability payments.

Rep. Josie Raymond, D-Louisville, also said she’s aware of child care centers with rate-increase letters ready to go out just in case the cabinet does not take over. She said the General Assembly is going to have to invest in subsidizing the child care industry moving forward.

“Do we want women between the ages of 20 and 40 to be in the workforce? Yeah, if we do, we need to subsidize starting with an additional stabilization in September,” Raymond added.

Senate Majority Caucus Chair Julie Raque Adams, R-Louisville, asked Day if DCBS has any legislative proposals outside of budget recommendations prepared. Day said she was not aware of any.

Adams said sometimes issues can be fixed through non-monetary solutions.

“We do it through legislative fixes, and so I would encourage you all in the cabinet to look at possible legislative proposals that you can bring to the General Assembly for us to consider,” Adams said.

After a lengthy discussion, Carroll, who works in the child care industry, said the industry is not looking for a bail out.

“These are ‘mom and pop’ child care centers that are just trying to help raise and educate kids so parents can go to work,” he said.

The next Interim Joint Committee on Families and Children meeting is scheduled for Aug. 24 at 2 p.m. at the Kentucky State Fair in Louisville.

For more information, visit legislature.ky.gov.

Photo: Committee co-chair Rep. Samara Heavrin, R-Leitchfield, speaking on the future of sustainability payments for child care centers. (LRC PIO)