KY Policy Blog

Child Care Assistance and Preschool Improved in Budget Agreement

By Dustin Pugel
April 22, 2016

The two-year budget agreement now being considered by Governor Bevin made incremental but substantial changes to the state’s two main investments in early childhood care and education (ECCE). The state’s Child Care Assistance Program (CCAP) was given $21.2 million more across the biennium than in the previous budget, so more families can become eligible for assistance. State funded preschool was held harmless, but its income eligibility limit was also increased.

While the state only uses General Fund money for public preschool, CCAP spending comes from the General Fund, tobacco settlement money and federal money through a grant called the Child Care Development Fund (CCDF). The proportions of these funds have shifted greatly since 2008 toward more state and fewer federal dollars, but overall CCAP funding has fallen, even with a significant state increase in the 2014-2016 biennial budget that offset an expected decline in CCDF funds. With the exception of a 42 percent cut in 2011, preschool funding has remained relatively level since 2008, but remains below its peak of $94.4 million in 2010.

The current budget agreement provides $10.6 million in each budget year for CCAP so the income eligibility limit can be increased from 150 percent of the 2011 federal poverty level, to 160 percent of the federal poverty level as annually determined by the federal Cabinet for Health and Human Services. If approved by the governor, a family of 4 making up to $38,880 would now be able to receive help paying for child care. This increase means an estimated 7,200 additional children will be eligible for assistance (though traditionally only about 20 percent of eligible children participate). And because the eligibility limit will no longer be anchored to a particular past year’s poverty level, CCAP can be responsive to changes in the economy over time.

Although the budget agreement did not increase funding for preschool, it raised the income eligibility limit from 160 percent to 200 percent of the federal poverty level so that, for example, a family of four making up to $48,600 could send their children to public preschool. An increase of this amount is likely to serve an additional 1,000 children. The $90.1 million appropriation also includes a $7.5 million grant program to encourage collaboration between private child care providers and public preschool programs. Such collaborations in the past have provided full-day, high quality early childhood education.

The department of Community Based Services, under which CCAP is administered, was cut 9 percent across the biennium, making this program one of the few that saw any increases. And after large cuts to higher education and flat-lined spending on K-12, these modest improvements to ECCE are all the more important.

High quality ECCE is widely recognized as an effective tool for providing children with opportunity later in life. While Gov. Bevin makes final decisions about Kentucky’s next budget he should protect these investments in our future.

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