The Trump administration announced a series of changes in federal childcare funding Monday that Wisconsin advocates say will amount to less regulation and undermine attempts to support childcare providers and workers.
The policies announced include a rollback of Biden administration programs that supported higher wages for childcare workers and put a ceiling on childcare costs for low-income families.
The Administration for Children and Families in the federal Department of Health and Human Services said in a press release the revisions in administrative rules would “lower costs, expand access, and better serve families who rely on federally-funded child care programs.”
Two Wisconsin childcare advocates said the proposals seem unlikely to live up to those expectations.
“There’s nothing saying there’s going to be more money,” said Corrine Hendrickson, a former New Glarus home childcare provider. “They’re just allowing [states] to move the money around in different ways.”
Hendrickson, who is the cofounder of a childcare advocacy coalition that includes providers and parents, closed her childcare business in August because she said she would have been forced to increase rates more than her families were willing to pay. She is campaigning for the Democratic nomination for a state Senate seat.
Ruth Schmidt, executive director for the Wisconsin Early Childhood Association, said the proposals are reversing support for policies aimed at addressing longstanding childcare challenges.
“Instead of investing in making a robust system of care that can pay a living wage to people doing this work, the same as our public education system does,” Schmidt said, the administration is “saying, ‘let’s roll back the ways we’ve been funding this. Let’s make it harder to work, have your child in care and get subsidized for doing that.’”
The actions announced Monday affect the federal Child Care and Development Fund, which states use to cover the cost of subsidized childcare for low-income families, as well as the federal government’s funding for Head Start childcare and preschool programs. They include direct guidance to states as well as federal rulemaking.
- A guidance memo encourages states to direct more funds from the federal government’s Temporary Assistance to Needy Families (TANF) to Child Care and Development Fund uses. It also states that states can use TANF money to “support needy married two-parent families in which one parent works and the other cares for a child at home.”
- A “Dear Colleague” letter highlights that under existing federal law, states are permitted to allow church childcare programs, other faith-based providers and family, friend and neighborhood caregivers to receive federal subsidies for children in their care.
- A final federal rule rescinds Biden administration policies that required states to pay providers in subsidized programs in advance for the month, limited low-income families’ copayments for subsidized care to 7% of their income, and allowed direct grants to providers
- A proposed federal rule rescinds Biden administration rules that tied wage and benefit requirements to Head Start grants.
The agency also sent governors a letter promoting the changes and calling the rescinded requirements “one-size fits all federal mandates that raise costs, limit supply, and crowd out providers.”
According to the First Five Years Fund, a nonprofit that advocates for strong federal support for quality childcare and early learning programs, 11% of children 5 or younger who are eligible receive subsidized childcare, and 35% of those eligible for the federal Head Start preschool program for low-income children are enrolled.
Hendrickson said with subsidized parents having to pay more out of pocket, some are more likely to forgo childcare and possibly leave the workforce.
“Just because you’re eligible doesn’t mean you can still afford to use the subsidy,” she said. “Unless the dollars go up significantly, this isn’t going to help any of these parents that are on a waitlist or aren’t able to access [care].”
Schmidt said the Biden administration changes guaranteed providers would receive subsidy payments based on enrollment at the beginning of the month, which offers childcare operators greater stability. The final rule change would allow states to shift payments to the end of the month based on attendance.
She said she thought Wisconsin might not make that change, however, because the state has seen that paying ahead rather than after the fact “helps stabilize the workforce.”
With the advice to states to spend more of their TANF funds on childcare, however, “then what else is getting cut?” Schmidt asked.
Schmidt said that the changes won’t improve childcare quality and won’t help support a system that would encourage professional childcare educators to stay in the field.
The state, or the nation as a whole, could invest revenue “and have a really robust system of care, which is what states are all already working towards,” Schmidt said. “I think it’s just really unfortunate that we have a federal government that is wanting to go down a path of deregulation and loosening of standards.”
