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Citizens Union

Child Care For Welfare Recipients

The United States Senate voted last month to increase funding for child care for welfare recipients and other low-income families, over the objection of the White House, which is firmly against any increase (In PDF Format).

Even as advocates support the Senate's proposed increase in child care funding, they worry that it will not be sufficient. First of all, they say, child care is already very underfunded - current funding only pays for one child in seven, nationally.

Worse, the reason behind the increase is mostly to facilitate the reauthorization of the 1996 federal welfare reform law. This law currently requires that 50 percent of a state's welfare recipients work 30 hours a week. The definition of "work" is very narrow and includes almost no education and training programs. The reauthorization will probably include an increase in both the percentage of welfare recipients required to work (to 70 percent) and the number of hours they have to work (40). More people working means their children will need some place to go while their parents are on the job; welfare recipients receive child care assistance as part of their benefits.

"Even a substantial increase in child care funding won't meet the overall need, and barely keep up with the new need that's created by the work requirements," says Don Friedman of the Community Service Society.

One of the most significant changes of the welfare reform act was the creation of a new system entitled Temporary Assistance for Needy Families, which gives "block grants" to the states. Prior to the 1996 legislation, states received federal welfare funds based on the number of individuals or families enrolled. Today, welfare is no longer an entitlement but is only a temporary - five year -- stopgap. But states receive the same amount of money that they received in 1995, even as the number of people on public assistance declines. The legislation gives states greater control over their welfare programs, and also allows a way for them to use surplus funds as caseloads drop. So New York's $2.4 billion grant has stayed the same even as the rolls went from 561,762 cases to 140,758.

Like states across the country, New York has relied on its surplus from the block grants to pay for a wide variety of social services, including child care -- the lack of which is one of the main reasons low-income workers can't keep jobs once they get them. In the last budget the federal block grant funded almost two-thirds of the city's child care budget.

Most of the city's child care funds go to the city Human Resources Administration, which distributes 45,000 child care vouchers for parents on public assistance, and the Administration for Child Services, which oversees the largest municipal child care system in the country. It provides child care and Head Start services to approximately 75,000 children, toddlers to pre-teens, and their families each year, mostly through contracts with private, non-profit organizations. But tentative new research shows that the city only serves 30 percent of pre-schoolers and 13 percent of school-aged children, says Sandy Socolar of the Welfare Reform Network Child Care Committee.

In the 1990s, when the economy was strong, New York was able to put aside a reserve of welfare funds. But with both the economic downturn of the last few years and federal cutbacks, New York, like other states, has been spending down its block grant. Governor George Pataki's current proposed budget predicts a surplus from the grant of $1.48 billion, 40 percent lower than in 2002. The result in New York City could be a shortfall of as much as $80 million in aid next year for child welfare programs overall, according to a prediction (In PDF Format) by the Independent Budget Office.

"Over the next two to three years most states will have exhausted their reserves," says Mark Greenberg of the Center for Law and Social Policy. "That virtually assures cuts in services, just to manage their funding within the next five years. The particular implication for child care is that they will have to cut either welfare-funded child care, or other, larger services, such as child welfare, domestic violence, the earned income tax credit. Communities will be faced with terrible choices. This is inevitable."

When the original welfare reform legislation was passed nearly a decade ago, advocates were concerned about the lack of education provisions, low benefits that do not adequately reflect the high cost of food and housing in New York City; work requirements that do not offer benefits or training; and the lack of affordable child care. But today some are calling for what they call a "clean extension," the simple renewal of the current legislation.

"We're pushing to get it reauthorized because we are so afraid of what will come out of it if we open the whole thing up," says Elizabeth Lubetkin-Lipton of the Women's City Club of New York (In PDF Format). "Better to go with the devil you know than the one you don't."

Sasha Nyary, formerly on the staff of Life Magazine and the mother of a public school student, edits the newsletter of The Fifth Avenue Committee, a community-based organization.












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