Childcare funding in New York a key issue in budget talks

BY: ELEONORA FRANCICA | 03/06/2023 10:07 AM EST

ALBANY, N.Y. — After last year’s state budget included a record investment in child care services, lawmakers, educators and advocates are seeking an expanded $5 billion annual investment in childcare in the new spending plan.

The push ahead of the March 31 deadline for an on-time budget deal comes after the state Legislature and Gov. Kathy Hochul last year enacted the Child Poverty Reduction Act, which commits the state to cut poverty by 50 percent over the next decade.

Last year, Hochul and lawmakers pledged to increase state aid for childcare by $7 billion over four years as a way to help New Yorkers address affordability barriers, including by raising the income eligibility cap for subsidies from 200 percent to 300 percent of the federal poverty level.

In her budget last month, Hochul proposed to expand eligibility for childcare assistance by raising the limit to 85 percent of New York’s median income, or approximately $93,200 per year for a family of four. She said it would allow about 113,000 more children to become eligible for assistance.

The state budget also includes a plan to cap the family co-payments at 1 percent of family income above the poverty level versus the current 10 percent cap. According to Hochul, her budget plan would expand access to care for 500,000 New York children.

Even though advocates considered the proposals a positive step for childcare, they also are arguing for further investments, particularly bolstering incentives to increase the childcare workforce.

State Sen. Jabari Brisport is pushing for stronger measures to help families address the soaring cost of childcare and help providers expand programs and add staff. | Brittainy Newman/AP Photo

Dede Hill, policy director for the Schuyler Center for Analysis and Advocacy and executive committee member of the Empire State Campaign for Child Care, said the proposed expansions would be meaningless if families cannot find childcare in their communities due to ongoing labor shortages in the industry.

The Schuyler Center found that New York child care capacity is down nearly 2 percent from pre-pandemic numbers. That comes after the group noted that in March 2020, 64 percent of families were reportedly living in child care “deserts,” which are areas without childcare providers.

“Parents and childcare providers made it absolutely clear that last year’s budget didn’t contain nearly enough funding to prevent the collapse of the childcare sector,” state Sen. Jabari Brisport, chair of the Children and Families Committee, said. “We simply cannot afford another year of half-measures — this is an emergency.”

Moreover, Hochul’s proposal does not meet childcare advocates most wanted change in the industry: to make childcare universal regardless of immigration status. Advocates say that thousands of New York children are currently ineligible for childcare assistance because of work and citizenship eligibility requirements barriers.

“To achieve the state’s commitment of cutting child poverty, it’s going to require the state to bolster quite a few of its policies and services that support families,” Hill said.

Lawmakers, led by Sen. Andrew Gounardes (D-Brooklyn), above, and Assemblymember Andrew Hevesi (D-Queens), are pushing for another bill to expand refundable tax credits for families. | Office of the New York State Senate

Supporters of the Empire State Campaign for Child Care rallied recently for a $5 billion investment in the final state budget to expand those aspects of child care, including a $1.2 billion fund to increase childcare workforce wages as a way to strengthen Hochul’s proposal to index minimum wage increases to inflation.

“Currently, the median hourly wage for an early childhood teacher working in our programs on Long Island is $16.50 an hour; that’s $31,838 per year before taxes come out, without benefits,” Maria Ahrens, owner and director of Paper Planes Early Learning Center in Suffolk County, said. “It is imperative that the budget includes the immediate Workforce Compensation Fund of $12,500 per child care provider and develop a true cost of care model for funding.”

Meanwhile, lawmakers, led by Sen. Andrew Gounardes (D-Brooklyn) and Assemblymember Andrew Hevesi (D-Queens), are pushing for another bill to expand refundable tax credits for families.

According to a Census Bureau study, the temporary pandemic expansion of the Federal Child Tax Credit in 2021, now expired, helped child poverty fall to a record low 5.2 percent, a 46 percent decline, helping 120,000 children in New York out of poverty.

The New York bill would boost the state Earned Income Tax Credit and Empire State Child Tax Credit, which for example, does not cover children aged 0 to 3.

The bill would also provide a maximum tax credit of $1,500 per child, which would include undocumented families currently excluded from the state’s Earned Income Tax Credit.

“The Working Families Tax Credit will help reduce child poverty by about 20 percent in New York, and it will put, on average, $1,000 back in the pockets of families who need help the most,” Gounardes said.

He added that the tax credit and new childcare funding would “support families with some of the most expensive costs they have. It’s expensive to raise a child; it’s expensive to care for a child; it’s expensive to have a family.”