“Supporting Working Families: State-Led Child Care Solutions”
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House Education and Workforce Subcommittee on Early Childhood, Elementary, and Secondary Education U.S. House of Representatives
Follow its sittingsSuzanne Bonamici
We should build on these successful models to expand access without sacrificing quality. I want to caution, however, about shifting the burden of child care and the crisis to states, employers, families, or even to the private sector and calling it a solution. Shifting responsibility will not solve the problem. Employers have an important role to play, but as we discussed at our hearing in January, child care is simply not a workplace perk, it's a necessary investment and a critical piece of our economic infrastructure. Most small and mid-sized businesses do not have the resources to solve a nationwide child care crisis and shortage on their own.
States can help, but many states are already facing budget cuts. And it's clear that families cannot solve the workforce shortage by paying more because the cost is already high. That's why federal investment matters. For example, during the pandemic, the Child Care and Development Block Grant, CCDBG, demonstrated what federal resources can accomplish. Congress provided additional funding that states used to serve more children, increase provider payment rates, and stabilize participating child care businesses.
That stabilization funding benefited an estimated 225,000 providers serving 10 million children. That was not government getting in the way of innovation, it was government giving states and providers the resources they need to innovate and respond to a crisis. But regrettably, we still have an enormous gap. In 2025, CCDBG served roughly 921,000 children, but nearly 6.4 million children were eligible. Current funding levels only allow about 14 percent of eligible children to participate in the program.
The expiration of relief dollars paired with stagnant funding has led to increased waitlists and fewer families served. It's my hope that today's discussion will focus on how we take what is working and make it available to more families. We should support states that are raising provider payment rates. We should invest in child care workers who are often paid poverty wages. We should expand the supply of care, particularly in rural communities and child care deserts.
And we should support providers who are there for parents like firefighters and nurses who work non-traditional hours. And we should make the care that exists affordable. We should also be willing to acknowledge what has not worked. We can and should investigate fraud and protect taxpayer dollars, but that should be without jeopardizing the care families need.
Accountability and investment are not mutually exclusive. The answer to a broken system is not to abandon it, it's to fix it. Innovation can show us the way forward, but Congress should support those innovations with the investment they need to reach families across the country, even in states with budget shortfalls. What we can and should do is pass legislation like the Child Care for Working Families Act, which would cap costs for families, expand access to high-quality care, and invest in the child care workforce. With federal investment, states can better support providers, lower costs, and make child care accessible and affordable to families.
Without it, child care workers will continue to be underpaid and families will be priced out, burned out, and left out. Thank you, Mr. Chairman, I look forward to the discussion and I yield back.
Speaker 1
Thank you very much. Pursuant to committee rule 8C, all members who wish to insert written statements into the record may do so by submitting them to the committee clerk electronically in Microsoft Word format by 5:00 PM 14 days after this hearing. And without objection, the hearing record will remain open for 14 days to allow such statements and other extraneous material noted during the hearing to be submitted for the official hearing record. I'll now introduce our witnesses. Our first witness is Ms. Ryan Page, Director of Child Care at the Iowa Department of Health and Human Services in Des Moines, Iowa.
Our second witness is Ms. Kate Shanks, Senior Vice President of Public Affairs at the Kentucky Chamber of Commerce in Frankfort, Kentucky. Our third witness is Ms. Hannah Melnick, Senior Policy Advisor and Director of Early Learning Policy at the Learning Policy Institute in Washington, D.C. And our fourth witness is Ms. Jude White, Assistant Commissioner for Child Care and Community Services at the Tennessee Department of Human Services in Nashville, Tennessee. We thank the witnesses for being here today and we look forward to your testimony. Pursuant to committee rules, I ask that you each limit your oral presentation to a three-minute summary of your written statement.
The clock will count down from three minutes, as committee members have many questions for you. However, pursuant to committee rule 8D and committee practice, we will not cut off your testimony until you reach the five-minute mark. I would also like to remind the witnesses to be aware of your responsibility to provide accurate information to the subcommittee. I'll first recognize Ms. Page for your testimony.
Ryan Page
Thank you so much. Chairman Kiley, Ranking Member Bonamici, and members of the subcommittee, thank you for the opportunity to testify at today's hearing on state-led child care solutions. I am Ryan Page, I serve as the Child Care Director at the Iowa Department of Health and Human Services. I've worked in the child care policy space since 2014 and have served the state of Iowa for nearly 20 years. HHS oversees the Child Care and Development Fund and all regulatory responsibilities over the Child Care and Development Block Grant.
Child care is essential to Iowa's economic strength and CCDF funding plays a critical role in supporting family stability and workforce participation. Under Governor Reynolds' leadership, Iowa has taken a pragmatic and data-driven approach, and our strategy is rooted in the understanding that child care supply depends on the financial stability of providers and the strength of the workforce. Because communities differ across Iowa, solutions are most effective when tailored locally and supported by regional partners, employers, and community leaders. Over the past five years, Iowa has added and maintained approximately 20,000 child care slots statewide. A key partner in this work is our Child Care Resource and Referral network.
They provide technical assistance, coaching, regulatory support, professional development, behavioral health resources, and parent referrals. This year, Iowa also added community development specialists. They work directly with employers and local governments to help communities understand their child care needs and build customized solutions. The Iowa Child Care Roadmap gives communities a single place to access tools and resources for building and sustaining child care. We have implemented targeted initiatives to strengthen supply, investing to help employers secure child care slots, investing in the Child Care Solutions Fund in nine pilot communities with a two-to-one match.
Many of those communities have continued these efforts independently, demonstrating that long-term sustainability can happen through short-term state support.
We also partner with the Child Care Collaborative of Iowa to provide financial coaching and help programs adopt child care management software. These tools reduce administrative burden and support long-term business sustainability. We launched Iowa Child Care Connect. This is a five-million-dollar platform that provides near real-time child care availability by age, location, and commuting route. This improves transparency for families and helps communities better understand their demand.
We've also worked to reduce regulatory burden while maintaining safety and quality. Through Governor Reynolds' Executive Order 10, we are simplifying rules for relatives providing subsidized care, and we streamlined regulations for facilities operating inside school buildings. To strengthen the workforce, Iowa created the Child Care Assistance for the Workforce program, which allows child care workers to qualify for assistance regardless of income. Since 2023, nearly 2,400 families have benefited, retention has remained strong, with over half of participating families renewing their eligibility across multiple years. We've partnered with the Iowa Department of Education, creating the Child Care Continuum of Care grants, supporting partnerships between preschools and licensed child care centers, supporting more than 300 children and allowing parents to fully participate in the workforce.
We continue to invest in early childhood educators through programs that improve qualifications, raise wages, and stabilize the workforce. Last year alone, Iowa supported hundreds of participants, achieving strong retention rates and delivering meaningful wage increases for early childhood professionals. In conclusion, Iowa's experience and approach shows that consistent, practical, community-informed, and partnership-driven strategies lead to sustainable results. By focusing on workforce stability, financial sustainability, and targeted investments, Iowa has expanded child care access while strengthening families and local economies. Thank you for the opportunity to share Iowa's work.
Kate Shanks
Thank you, Chairman Kiley, Ranking Member Bonamici, members of the subcommittee. Thank you so much for the opportunity to be here today to talk about what Kentucky has been working on. I'm Kate Shanks, I'm the Senior Vice President of Public Affairs for the Kentucky Chamber of Commerce. This is a critical issue for the business community because it's a workforce issue. That's our focus on child care.
Our Center for Policy and Research found that if you can reduce the cost of child care, increase availability, you can help upwards of 16,000 to 28,000 Kentuckians rejoin the workforce. That is very meaningful in a state like Kentucky. Child care is very important to the business community. Our board of directors identified it as a top strategic priority, and in 2024, we launched the Kentucky Collaborative on Child Care to develop consensus-driven solutions to our biggest child care problems. That work helped inform House Bill 6, a comprehensive piece of legislation that passed the Kentucky General Assembly with bipartisan support earlier this year.
We greatly appreciate the leadership of the business community, our partners at the collaborative, and of course the work of the Kentucky General Assembly that has passed meaningful legislation and also provided important appropriations to support the programs. I want to walk through just a few of the examples of where we've been innovative in Kentucky. First, we'll talk about the child care workforce. We make child care workers eligible for child care assistance regardless of income. This helped 5,300 people, approximately 5,300 people in Kentucky last year, and you can imagine the number of families impacted by that.
It's a retention tool and it's a recruitment tool for the child care industry that struggles with workforce issues. Second, we created a new license for micro-centers. These are smaller centers that serve less than 30 kids, they typically have different regulations on playgrounds, kitchens, mixing age groups, and they fill that gap in between family child care homes and larger child care facilities that's important for certain areas of our state as well as important for certain workforce types.
So that's a new thing that we have added. Third, we created the certified child care community program in recognizing that local government has a role in this. We need to look at our land use rules, we need to look at planning and zoning, and this program created a model ordinance, resources, and steps local governments can take to address some of their land use rules that can create challenges for building new child care centers and creating more child care homes. We also addressed affordability with Kentucky's tri-share model, which is the employee child care assistance program. This is a voluntary program for businesses.
They can set the benefit level for workers, and then the state will match it up to dollar for dollar, and so a $200 benefit can become a $400 benefit through this program, which is incredibly meaningful for those middle-income families that don't qualify for child care assistance. And then finally, better data. We want to better understand supply and demand. We want to look at that methodology, we want to make sure we're not overstating supply, we're not missing some of the differences that families have in terms of what their choices are and what their interests are with child care. And we want to create that methodology because we know it's important to identify what areas of the state have some of the biggest constraints.
And lastly, I'd like to just say that we appreciate the flexibility that we have to innovate in Kentucky. We thank you for your work on CCDF, on the Child Care Development Fund, expanding the employer-provided child care tax credit. Thank you again so much for allowing me to be here today to speak about Kentucky, and I look forward to the conversation.
Hanna Melnick
Chair Kiley, Ranking Member Bonamici, and members of the subcommittee, thank you for the invitation to participate in this hearing today. My name is Hanna Melnick. I'm director of early learning policy at the Learning Policy Institute, which conducts independent, high-quality research to improve education policy and practice. I'm also glad to be here today because it's a personal matter for me as the parent of two young children. Today I'll discuss the importance of early care and education, by which I mean any setting in which a child receives care prior to kindergarten entry, as well as barriers, state innovations, and a path forward.
The children's early years are a crucial time for their learning and development. Well-designed and well-implemented programs can foster meaningful developmental gains that have the benefits of setting children up for success in school and life. Rigorous evaluations show a high return on investment. For families, however, we know that the cost of quality child care is often out of reach. Costs have far outpaced groceries and housing, and as a result, more than one in 10 parents of young children has been forced to either reduce their hours or leave the workforce altogether.
Child care challenges, reduced productivity, and result in lost earnings, which cost the US an estimated $172 billion annually. The federal government plays a very important role in making high-quality child care and early care and education accessible, particularly through the Child Care and Development Block Grant, Head Start, and the Preschool Development Grants. However, total program funding is too low to serve all children. For example, just 11% of eligible infants and toddlers participate in Early Head Start, and 16% of eligible children benefit from a child care subsidy. What is more, child care providers are paid very low rates and get little professional support.
In fact, we pay our educators so little that 43% rely on public assistance and one in five is food insecure. Federal actions have made it even harder to run a quality program recently. In the past year, federal government has delayed Head Start funding and threatened to freeze child care funds, leading to service delays and staff turnover. Despite this challenging backdrop, states are leading. Two states, Vermont and New Mexico, have made child care universal recently, New Mexico using its oil and gas revenues and Vermont implemented a payroll tax passed with the backing of its local business.
In terms of quality innovations, Alabama has made instructional coaching an evidence-based strategy a priority for its infant and toddler teachers who often get very little support. And Virginia and North Carolina have helped to show that raising educator compensation even by a small amount can have a big effect on the workforce. In Virginia's incentive program, for example, cut turnover by half. However, these states' work is not a substitute for federal investment. The quality initiatives in Alabama and North Carolina, for example, reach only a fraction of providers and most states do not have New Mexico's natural resource wealth.
Federal policymakers should therefore take the following steps to increase access to early care and education that meets all family and children's needs. First, Congress should increase federal funding for existing programs such that no family has to pay more than 7% of their income to get the care they need. Second, Congress should maintain and increase quality across federally funded programs, setting a higher threshold for programs that receive funding from the Child Care and Development Block Grant and maintaining Head Start's current evidence-based standards, which the administration has proposed repealing. And third, Congress should provide adequate funding for federal programs to cover the true cost of quality care, including better compensation for educators. Thank you for this opportunity to testify and I welcome your questions.
Jude White
Thank you very much. And lastly, I recognize Ms. White for your testimony.
Good morning, Chairman Kiley, Ranking Member Bonamici, and members of the committee. Thank you for the opportunity to talk about child care innovations in Tennessee. At TDHS, we understand the vital importance of healthy, safe, and developmentally rich child care and its impact on our communities. I am Jude White, the Assistant Commissioner for Child Care and Community Services at the Tennessee Department of Human Services. We know that access to quality child care is critical for parents to fully participate in the workforce.
I'm incredibly proud to represent the coalition of Tennesseans who have contributed their time, expertise, creativity, and private investments toward growing sustainability and accessibility of child care in Tennessee. As responsible stewards of taxpayer dollars, we are continuously working to collaborate and leverage resources to maximize impact. In Tennessee, we have worked over the past decade to modernize our child care regulatory landscape. We modernized our technology with system changes that decrease the administrative burden for parents, providers, and our community. Alongside our technology improvements, we changed our program and staffing structure, completely redesigning our quality rating improvement system to support our goals of continuous improvement for providers and improving transparency for parents.
We worked with providers to rewrite our regulations to first protect children, but also to remove red tape. For example, we have worked with our state fire marshal's office to streamline inspections and we're working with a number of localities to address codes and zoning limitations. One of the most substantial results of our program and staff restructuring was launch of our pre-licensure unit in 2021. This unit helps potential child care providers navigate the licensing process.
We meet providers where they are and help them build capacity to support their community. We know one size doesn't fit all. The pre-licensure unit is a group of solution-oriented problem-solving individuals, and I'm proud of their innovative ideas and the relationships they've built across the state. Newly licensed childcare agencies consistently tell us how supported they have felt navigating the steps toward licensure and reaching their goal to provide quality care for children. Once the pre-licensure process is complete, our team then does a warm handoff to our licensing consultants who support continued compliance.
Over the last five years, the pre-licensure unit has opened over 44,000 childcare slots across the state, and they're still going. Another duty of our pre-licensure unit is to engage Tennessee employers to invest in their workforce through innovative childcare strategies. In Tennessee, we've been actively partnering with businesses to grow childcare capacity since 2018. We are grateful to our state legislature for allocating 45 million in a three-year pilot to establish or make improvements to childcare, including new construction. We've supported the banking industry, the hospital industry, local school districts, and even the US Department of Energy by granting funds for private employers and childcare agencies to partner to create sustainable childcare facilities.
We also recognize in Tennessee that childcare workers are the backbone of this industry. We are lucky that Tennessee has been on the front lines participating in the nationally recognized wages program since 2019. This program offers a salary supplement to childcare workers who commit to professional development and stability of their employment. We are also proud that TDHS and the Lee administration led the charge to invest an additional 7 million of state dollars to raise the eligibility of workers able to receive the salary supplement. With this program, we have proven lower turnover rates, cutting administrative burden for providers, and promoting continuity of care for kids.
We're also very proud that TDHS received an additional 5 million state dollars invested in Smart Steps, our certificate subsidy program. This program is wonderful, but we did not want to penalize families when something good happens: a promotion, a marriage, a pay increase. Without this investment, families would be required to lose their childcare payment assistance when they cross the 85th percentile of state median income. Instead, now we're not penalizing those families but are actually encouraging people to grow their capacity and reduce dependency. Government cannot do this alone, but government can help by promoting innovative strategies that allow public and private dollars to be spent in the most impactful way.
We are using our data, our experience, and our partnerships to ensure that we're investing in policies that are promoting long-term sustainable childcare that meets the needs of Tennessee families and employers. Thank you for this opportunity.
Speaker 7
Thank you very much. Under committee rule nine, we will now question witnesses under the five-minute rule, and I'll first recognize Mr. Moylan.
Thank you, Mr. Chairman, and thank you to the panel. This morning, I heard about the affordability and that we need to make childcare affordable for working families. Also heard your statements talking about childcare keeps Americans working, that access to affordable quality care means working parents can participate in the economy. Your testimonies also talked about federal policies needs to support families, and Washington can't keep doing the same thing over and over again. We need to innovate and tailor support to where they're needed most.
And finally, the federal policies should not be a one-size-fits-all approach to problems that occur nationwide. The challenges that families in my district, Guam, face are not the same or the exact as the families in California all the way to Florida. So childcare solutions cannot be dictated top-down by the federal government. Families know better than the federal government what care works best for them. And that's why it's important that we empower rather than restrict states and territories to find sustainable solutions, like you all been telling us.
So, Ms. Shanks, in your testimony, you mentioned how the chamber made addressing childcare challenges a key issue, which I'm glad to hear. I really support our Guam Chamber of Commerce as well.
Can you elaborate more on how public-private partnership and flexibility have led to better outcomes for families? And second, what are you seeing in terms of cost reduction?
Kate Shanks
Thank you for that question. I think it's a really important topic that we discuss today in terms of flexibility and choice. That is something that is important to Kentuckians and it's been important to our policy makers that have worked in this space. In terms of the different types of child care facilities that are provided in Kentucky, we of course are a rural state. We have many rural areas of our state.
Certified family child care homes are a very important part of our child care network. We have around 200 of them across the state. We have a strong network that supports them. And we're very focused when we work on programming or new policy design that we are incorporating them into that process. And so of course they can take advantage of various programs through the CCDBG program, our child care tri-share model, the employee child care assistance program, absolutely is available to our certified family child care homes.
And as we continue to work on the quality rating system in Kentucky, we're going to be focusing on making sure that that particular voice is at the table and that we can provide reforms and provisions that are applicable to them. So that's very important. The micro-center piece is also very important because that is something that can very much fill a gap between what we have today, which are the smaller family child care homes, and what we can expect to have in the future with these micro-centers. And so they get a little bit different of a regulatory framework as appropriate because they're small. And so we're going to be working on licensing those.
And so the flexibility that we have as a state to develop that because we do have third shift that might benefit from that type of facility. We do have rural areas of the state that might benefit. I think it's really important. In terms of the economy, as we work on this issue, we're the Chamber of Commerce, so we love to talk about the economy. We will talk about jobs, absolutely, but we also want to talk about the workforce and making sure that we have the workers to fill the jobs.
And that's why we focus on this particular issue. If we can get upwards of 16,000 to 28,000 Kentuckians back in the workforce by reducing the cost of child care, we are looking at a 600 million to billion dollar economic investment in our state through wages, revenue, and other means. This is significant and it would bring Kentucky up out of the bottom 10 of states on workforce participation. This is a very stubborn problem that we have in our state. And so we continue to work on it.
And so we do believe that it is meaningful to do that. Our tri-share program, we're seeing an average of around 250 dollars is what employers are providing per month. The state's matching it around 200. And so we can see a meaningful benefit to those working families to help them and help more people get back in the workforce.
Speaker 8
Thank you to the panel for your presentations and I look forward to working closely with you to help our territory of Guam as well. Thank you so much. Thank you, Mr. Chairman.
Ranking member Bonamici of Oregon is recognized.
Kate Shanks
Thank you, Mr. Chairman. Thank you all for your testimony. It's really encouraging to hear about what you're doing in your states and we've heard about some pretty creative state innovations. And they're important. States should continue to implement programs that strengthen the child care system, but the innovations are not a substitute for federal investment.
Improving access to quality, affordable child care is an economic priority for our country. Many of us Yet federal funding freezes and other funding interruptions have been delaying resources from reaching families, children, and providers.
Suzanne Bonamici
Improving access to quality, affordable child care is an economic priority for our country. Yet federal funding freezes and other funding interruptions have been delaying resources from reaching families, children, and providers. Many of us served in state legislatures and we know that states balance their budgets and many, not just blue states, are already facing cuts. So I want to ask you, Ms. Melnick, first of all, thank you for clearly laying out steps that we can be doing. Will you focus on the importance of federal investments in helping states innovate and provide accessible child care?
Hanna Melnick
Of course, thank you for the question. So the federal government has a very important role to play in working with states to expand access. States are making a lot of headway, particularly for access for four-year-olds in preschool, but when it comes to children birth through age three, really no state has it figured out. And that is why our programs like Head Start and CCDF are so vital. The Child Care Development Block Grant, as I mentioned, reaches only 16 percent of eligible children.
And so again, the most impactful role for the Congress would be to increase the overall level of funding for these programs. I think it's particularly important not just that it's to increase access for all children, but to increase the level of funding that programs and providers receive so they can pay their staff a living wage and make sure that children get the quality care they need because it's so important for their learning and development as well as for families.
Suzanne Bonamici
Thank you. And these are policy choices. I'd like to ask unanimous consent to insert for the record a letter I led to increase funding for the Child Care Development Block Grant program to at least an additional 3.5 billion dollars in fiscal year 20.
Without objection.
Suzanne Bonamici
Thank you. And again, these are policy choices. This Congress at the beginning of the Congress gave 170 billion dollars to ICE and then the Department of Homeland Security and then later gave an additional 70 billion with a B dollars to the Department of Homeland Security for ICE. Rather than continuing to traumatize a generation of children, I have introduced the Daycare Not Detention Act to use that additional 70 billion dollars to help children and families. This would nearly triple the CCDBG, double funding for child care entitlement to states, Head Start, and the Preschool Development Block Grant.
That would do all of that by taking that additional 70 billion dollars and investing in our communities and they'll be safer and stronger with that generational investment in our youngest learners. Also, I know the focus of this hearing isn't Head Start, but Ms. Melnick, you mentioned Head Start and I'd be remiss if I did not bring up the Trump administration's proposed changes to that critical program. It's my understanding even the chairman has expressed some concern about this. We are hearing concern across the country. The draft rule would, as civil rights and disability groups are describing, dismantle the program from the inside out.
Among other things, the proposal would undermine Head Start's quality standards for education, strip away requirements designed to get children to meet critical benchmarks, decrease parental engagement, and make it harder for English language learners to participate. Last week I met with providers and families in Oregon who are very concerned about this proposed rule. One mother said, I don't know where we would have gotten support anywhere else. And a provider said, thinking about having less support feels untenable.
Hanna Melnick
For example, the rule would rescind regulations related to program hours. HHS projects that this will lead to many fewer hours and days of service. So that means less learning time for children and less care for families. It would also reduce Head Start's class or change Head Start's class size and ratio requirements, which are in place to ensure that children get those high-quality interactions that they need with their caring adults. And in their own analysis, HHS says this would lead to larger class sizes for Head Start and fewer teachers, both of which are associated with lower quality for children.
Speaker 1
Thank you. I also heard a lot of concern about children with disabilities and Head Start has done a phenomenal job helping those kids. We heard a story about a girl who was struggling because she couldn't hear. They didn't know that and they helped her get hearing aids and now she's thriving. So I'm out of time, I yield back.
Thank you.
I'll now recognize myself for five minutes. I want to thank all the witnesses for your outstanding testimony. And I think, you know, talking to families in my district across California, the cost of child care has just become more and more of an issue when you pile it on top of the cost of living when it comes to groceries and gas and energy and housing and everything else. And we have some of the highest child care costs in the entire country. And so we've sort of identified a couple sets of solutions so far today, one of which is, you know, focused on increasing supply through developing the workforce, through paying providers more, through giving them child care coverage, 100% of them, through allowing for greater flexibility with things like micro-centers, you know, rolling back needless regulations, adopting zoning and licensing requirements, funding new facilities.
All of that serves to increase demand. And then on the or supply. And then on the demand side, of course, there's the block grant and other supplemental programs at the state and local level that try to give families greater purchasing power. But then you also have this question of how do you connect families with the service that's best for them. And so I'm really intrigued, Ms. Page, by your Child Care Connect program because if this functions to sort of let a family know about an option that let's say is closer to them and is more affordable, then in a way that's just as good as giving them, you know, a higher voucher.
So how does that work?
Ryan Page
Um, yeah, Iowa Child Care Connect C3 is about one of the most favorite things that I can talk about. We are very proud of it. It's a game changer for our parents who are looking for child care that meets their needs. We also have data dashboards that support our communities and our child care providers in understanding supply and demand information. There's licensed capacity, operational capacity.
We link that with vital statistic birth records all within a system to make better data-driven outcomes. Our families are able to see this in near real time. So we have multiple data sources that are feeding the system. And what they're able to do is see something that meets their needs. Does it meet the age of my child, the type of child care, the quality of child care, does it take subsidy or not take subsidy?
And it's practically a built-in marketing tool for our child care facilities as well because when you get it on the map, if they're green, you're going to see they meet the needs that I'm looking for. If they're red, they don't meet those needs. And therefore, providers want to keep that information up and current and available for families so that they're showing that they have accessibility and availability. We're also able to evaluate the area market for current needs, future needs at the state and the local level.
Speaker 1
Yeah, that'd be fantastic if every family, every community had access to to something like that. I think it's a really great model. I did want to address the the issue of Head Start, because I think protecting Head Start is is vitally important. And I don't want to get into the specifics of this particular rule other than to say that I think major changes to the program really should be led by Congress. But, Ms. Melnick, could you just talk a little more on a higher level about the importance of Head Start, both from the perspective of child care as we're talking about today, but also in terms of early childhood development, educational equity, and so forth?
Hanna Melnick
Of course, happy to. So Head Start along with other high-quality early childhood programs have been shown to have really important benefits for children and for society. So in the long run, they well they do support children's academic success in school, but in the long run they also support things like health their well-being and health, have they have higher earnings, lower crime rates, lower teen pregnancy rates. So it can have a really lasting impact on the children as well as the families that they're serving. And I think that the quality of those programs is critically important and that's why it's really important that we continue to fund Head Start and programs like it at the level that is needed for them to be able to, for example, recruit and retain staff who are well-qualified.
Speaker 1
Thank you very much and I'll look forward to working with the ranking member to to protect this program and assure that it works to the benefit of as many kids across the country as possible. And then finally, Ms. Shanks, you know, we in prior hearings have have kind of gotten into the numbers specifically of of the cost of child care and how it's continued to increase. Are there any I mean you probably have some centers that are chamber members maybe. Are there any drivers of these costs that maybe we haven't discussed that might be worth looking at and that could be addressed through policy?
Kate Shanks
Oh, I think so for sure. I mean you've talked about labor issues. I mean it's a very labor-intensive service. You it's that that is important for caring for children. We work on a program where we provide free child care assistance for child care workers.
As I mentioned, we had 5,300 people participate in that. Huge impact for working families and all of the kids that they serve. I think there's always opportunities to look at red tape and look at regulations where there might be opportunities to streamline and create some changes that can be important reforms. I also think that the piece at the local level is important. If there are land-use rules that are prohibiting new child care facilities from opening, maybe it's a family child care home, maybe it's a larger facility.
Perhaps it's inadvertent that those regulations are on the books. I think that's an important piece to look at because we have found specifically in Jefferson County in Louisville, Louisville area, they were able to do that. They spent some time studying that issue, working with stakeholders and clarifying how family child care homes can exist in residential areas, clarifying issues around where they exist in commercial areas as well as industrial. And so I think other communities in Kentucky can learn from that and that can help drive down costs for these facilities and these providers.
Speaker 9
Thanks very much. Ms. Lee of Pennsylvania is recognized.
Thank you, Mr. Chairman. State and local governments are working hard to address the child care crisis, but if state-led innovations were sufficient, we wouldn't be in a child care crisis. The federal government can and it must intervene. And we know it's possible because we've done it before. During World War II, Congress used defense funding to build child care centers in more than 600 communities across the US.
Of course, we were willing to make those investments when it was for women to fill factory jobs during a war. But in 1964, Head Start was founded to address poverty by supporting early education, health, nutrition, and social-emotional development.
But it is an important and successful program, so of course Trump is now gutting it. And let's not forget when Congress actually did pass a bipartisan bill for a multi-billion dollar national childcare system in 1971, only for Nixon to veto it because of a conservative disinformation campaign saying that the bill was a communist plot to destroy the nuclear family. Attacks on childcare and a lack of federal investment have had lasting consequences for children and families across our country. Now states are also facing historic cuts to federal programs like Medicaid and SNAP, which are going to just compound the affordability crises that people are facing, that everyday working families are facing in our country. I regularly hear from people in my district in Pennsylvania about what is going to happen to things like childcare when these states are going to have massive shortfalls to address.
And I'm wondering if people from your states share those same concerns. Ms. White, Tennessee faced a $44.5 million cut to its Child Care and Development Fund, which resulted in cuts to the program. Your testimony also mentions the importance of state-level investments, like the $45 million pilot program to expand employer-sponsored childcare. Given these CCDF cuts and Tennessee's reliance on state-level investments, how do you all imagine that the state budget shortfall due to federal cuts will impact childcare in your state?
Jude White
Yes, thank you so much for that question. And that has been a very challenging experience for us in the state of Tennessee. It was a reduction of our Child Care Development Fund discretionary award by about 44 and a half million, as you said, which we learned about towards the end of the federal fiscal year 2025. So it did require us to make some fairly immediate decisions, difficult choices. We did implement a waitlist for families to enroll in our Smart Steps childcare payment assistance program.
We had to shift some of our quality contracts for some of the supports we give providers. And as challenging as all that has been, and of course there's one bucket of the Child Care Development Fund that has to be distributed across the states according to a particular formula, as challenging as all that has been, we really tried to see this as an opportunity to step back and perhaps rethink some of our approach. And so we have rethought and retooled how we provide professional development supports to the workforce. We are continuously evaluating our market rates and our subsidy rates, as well as leaning into the private investment and support from employers, recognizing that CCDF is one piece, and if we're declining there, then what can we lift up in other spaces?
Speaker 9
Thank you so much for that answer. Ms. Melnick, could you quickly, briefly speak to how funding cuts from Republicans' so-called one big beautiful bill and this administration's attacks on childcare are already impacting states' ability to invest in childcare and what the future impacts might be?
Hanna Melnick
Of course. So we know that families and childcare providers are both reliant upon some of the federal supports that are being cut. So this is also going to impact our teacher workforce. We have 23% of our childcare providers who are dependent upon Medicaid because they don't get employer-sponsored health insurance. So this could help, could actually push some of those staff over the edge and make sure, keep them from serving the children that we need in childcare.
It's also having an important effect on many states, which were already in a tough place with the end of pandemic-era funding for childcare and making cuts there. So this will put an even greater burden on them and make them have to make tough decisions about childcare funds.
Speaker 9
Thank you. And I just want to say that this should not be a partisan issue, but I will say that the three witnesses we have here today are in Trump-voting states, which means that they're less likely to see what we saw in January, when the administration tried to freeze 10 billion dollars in child care and other social service funding to Democratic-led states. But the moral of the story is that we have a child care crisis everywhere and there are things that our federal government can do. We can start by passing the Child Care for Working Families Act, the Head Start for America's Children Act, and any number of Democratic proposals that expand federal investments instead of further cutting off families' access. I thank you all so much for your time and for your testimony and I yield back.
Andy Harris
Thank you, Mr. Chairman, and thank you to all of you on the panel today for your testimonies. I appreciate not only what you shared here, but your written testimony that you had submitted beforehand. It's obvious if there's one issue that reaches across the country and impacts millions of American families, it is child care. Child care supports parents' ability to work, strengthens economic security for families in the country, and helps provide businesses with a reliable workforce across America. Nationwide, I understand there's about 14.8 million children under age five that may need child care, and when you broaden that lens out to children 13 and under, it's nearly 55 million children that may need care during traditional and non-traditional work hours.
Now, one way to address the child care needs that exist is through innovation and partnerships, and we've heard some of you share about that today. And Ms. Page, I want to just talk for a few moments about Iowa's Child Care Solutions Fund that has relied on private contributions from businesses, residents, and non-profit organizations. These funds focus on employee retention and compensation. My question to you is how was Iowa able to convince these various partners to participate and what specific programs have strengthened child care workforce retention in your state?
Ryan Page
Thank you for that question. The Child Care Solutions Fund was a time-limited nine-month opportunity with targeted communities who had already been working to stand up this effort. We had one Iowa community that had been doing this for several years and we wanted to capitalize on that success of the model in other areas. So what Iowa and HHS did is we were able to secure a two-to-one dollar match for those communities. We don't want to take credit at all for the funds that those local communities were able to raise, that was their own innovation and securing from private contributions, but we incentivized that engagement with that matching for secured donations.
These projects proved highly successful, most if not all of them are maintaining at the local funding model. It's important to note, however, that communities will always have competing priorities, we all need to be collaborative partners and we acknowledge that in all areas there remain to be limited resources. In addition to the Solutions Fund, we are specifically working on improving administration of child care businesses, child care management systems, partnering with the use of financial management coaches, improving business practices, and supporting a sustainable business model. We've contracted for Iowa-specific business fundamental training for our facilities. Lastly, we highly invest in T.E.A.C.H. and WAGE$ as well to support increasing educational credentialing, providing wage stipend to support the increase in education, supporting the workforce infrastructure, improving the sustainability of programs, and improving consistency for children and families.
Andy Harris
In your testimony that you submitted beforehand and you just noted again, you mentioned that most participating communities have continued these initiatives on their own. I guess my question is how did Iowa's initial investment help communities build child care solutions that could become self-sustaining rather than rely on government funding? I guess my question is what's the secret sauce and how did you guys do that?
Ryan Page
I would like to say that there is a secret answer, but really it was about our communities coming together and coming up with solutions and the state being able to come in and support that effort. So we need to focus on our local communities and driving what they indicate is necessary for their local communities. What is needed in Des Moines is not going to be the same as a rural community in Iowa. And so when we're able to listen to the boots on the ground, the people that are saying what is necessary, we're going to come in and support that in the best way possible, time-limited investments, potentially, you know, offering those opportunities statewide when there's funding to support that. Otherwise, we're going to take their lead and we're going to support that work.
Andy Harris
Thank you. Thank you so much. With that, I'll yield back, Mr. Chairman.
Alma Adams
Thank you, Mr. Chairman, and thank you all for your testimony and for being here today. There's been a lot of discussion about what states are doing on child care, and that's important. But states cannot solve this problem alone, and many of the problems that we're hearing about today still rely on federal funding and support. So if we want to expand access, keep providers open, and support the child care workforce, the federal government still has a role to play. Ms. Melnick, in my district of Charlotte, North Carolina, 61% of young children live in a child care desert.
Now, that means for a lot of parents, even if they can afford child care, there simply may not be a licensed provider nearby with an open slot. There's a lot of talk here about let's highlight what states are doing in the child care space. Your note in your testimony also says this is a national problem, especially when nearly 46% of children live in areas where licensed care is unavailable or there are more than three children for every available slot. For a working mother or father who just needs somewhere safe and reliable for their child while they go to work, what does living in a child care desert actually mean day to day, and what can Congress do to help states create more child care options without lowering the quality of care?
Hanna Melnick
Thank you for that question. So I completely agree, parents need to have both the ability to afford quality care and they need to have a supply of quality child care options in their area that they trust for their child. And for so many families, that is simply not the case. We don't have the supply even when families can afford it. And that's partly because it's a broken market.
Even as parents pay as much or more than they can afford, providers can barely keep their doors open. And that's why federal funds for programs like Head Start and CCDF are so important. Head Start fills a vital gap, especially in rural areas and in child care deserts where it is often the only option available. And when we add funds, though, to voucher programs like CCDF, we see that it will in some cases increase the supply. But what we really need to do is make sure that the amount of funding that is given to providers when we're funding them is sufficient for them to really be able to have a thriving business.
Alma Adams
Okay. So, Ms. Melnick, we can build all the child care centers we want, but they cannot stay open if there's nobody there to care for the children. And you point out that child care educators are paid very little. In fact, many rely on programs like SNAP and Medicaid just to make ends meet. You also highlight North Carolina's WAGE$ program, which provides salary supplements to child care educators and has helped reduce turnover at these sites.
So what have states like North Carolina taught us about keeping good child care workers in the classroom, and where does the federal government need to step in so that states can actually take these programs to scale?
Hanna Melnick
Absolutely. So North Carolina's WAGES program does two things. It both increases wages for staff once they've been retained in the classroom, and it helps them to improve their level of education and their preparation. I think it shows that early educators really want to increase their qualifications. They really want to do this job, but they need more support to be able to stay in the job that they love.
Alma Adams
Okay. And Ms. Melnick, in your testimony you mentioned the recession of the Biden-era regulations capping child care copayments for low-income families. So how will this deregulation affect working families' access to child care, and do you think that this deregulation might affect individual states' capacity to invest in innovative solutions to the child care crisis?
I think it's very clear that states are dependent on federal funds to be able to innovate. The Preschool Development Grants have shown us that, pandemic-era funds have shown us that, that when some of the states have come up with the most innovative solutions, like in California, also having the opportunity to create things like Iowa's website that helps you find care, that's because of the additional funds that gives them that opportunity.
Alma Adams
You know, some states have taken steps to ensure that parents of young children with disabilities have robust child care options and that providers have the training and resources they need to provide appropriate care for children. So can you talk just briefly about some of the policies that states have implemented?
The best thing that we can do to support our children with disabilities is to intervene early. But I think it's very clear from the research that very too few children have the access to care when they're in their birth to age three, and that's one of the things we really need to make sure we're supporting at the federal level.
Alma Adams
Thank you very much. Thank you for your testimony. I'm out of time, Mr. Chairman. I yield back.
Chairman Walberg of Michigan is recognized.
Tim Walberg
Thank you, Mr. Chair, and thanks to the panel for being here on an important issue. My first question is for the state witnesses, Ms. Page, Shanks, and White. A strength of CCDBG is the flexibility that it provides, and flexibility doesn't come easily in many cases, especially wide-ranging as child care. But it's necessary. Gives parents the option of choosing the type of care that's right for their family.
And so how has your state found ways to support a variety of provider types through the various innovative solutions, Ms. Page?
Ryan Page
Absolutely. We're really focused on parent choice and flexible options for families. Iowa's licensed and regulatory child care landscape, which then includes the use of the Child Care and Development Fund subsidy, supports parents that may choose licensed child care centers, that includes before and after school programming, faith-based programs, and preschools, as well as family child care homes that can include relative providers. We not only want to recruit new programs, particularly home child care providers, but also retain those that already exist. So we are looking at pragmatic solutions, regulatory reform, including making it easier and less onerous for relatives to provide care to family members, which can support parent choice in who Iowa's families leave their children with while they're working or furthering their education.
Great, great ideas. Ms. Shanks.
Kate Shanks
Thank you for that question, and I've spoken about our work with family child care homes, our micro-centers, but I want to mention another type of child care facility that we're seeing more of, and I think we could see more of because of the new tax credit that was been or the tax credit that's been expanded.
We have a wonderful medical center, Pikeville Medical Center in Pike County, Kentucky, so far eastern Kentucky, that has started a child care center and they are expanding it. They've purchased an old grocery store building, they've hired an architect, they are renovating it, and they are expanding the services that they already provide. And so this is a hospital that is recruiting healthcare workers, doctors, nurses in a part of the state where that healthcare is critically important. If you're going to travel from eastern Kentucky to another part of the state to get healthcare, you know, that could be quite a drive and that can be problematic for some families in terms of access to care. And so the fact that they're taking these steps is so important.
And so as we continue to look at programming at the federal, state, local level, we need to remember that there are employers that are going to roll up their sleeves, that are in communities where maybe there is a lack of child care and they're going to go build it. And I think that's a really important piece of the puzzle because they're not just going to provide that for their workers, but they're going to provide it for others in the community. Not all employers can do that or have that kind of workforce. That's where the employee child care assistance program comes into play, our tri-share model. We've got great businesses participating in that, CVG Airport up in northern Kentucky, you may have flown into that airport, they participate, Planters Bank in Hopkinsville also participates, and we have several others.
And so as we continue to work on policy at the state level, we will be focused on flexibility so that we can allow those businesses to play those important partnerships.
Jude White
And your story talks about economic development across the board, as well as thanks for mentioning the benefit of the new child tax credit advantage that was expanded. So thank you. Ms. White.
Yes, thanks so much for the question. And so as Ms. Shanks was saying, that employer partnership in developing child care resources for their workforce is critically important. As we administer our employer partnership grants using state dollars in Tennessee, one of the criteria we look at when we're reviewing proposals is whether or not they've engaged their workforce to understand what those families want and need, in addition to whatever the employer's needs are in terms of their shift schedule. And so as Ms. Shanks was saying, it could be an employer who chooses to build child care from the ground up and they can control the shifts that they offer and they can control even the wages of the staff who work there. That's one model.
Other employers may choose to find an existing child care agency and partner with them to reserve some slots for their employee workforce. It really all depends on what that employer's workforce is telling them that they want. We do in Tennessee offer a family child care network, so through our child care resource and referral program, we do want those family child care providers to be available. Some parents may choose that they want their child to be with the same caregiver from infancy up through school age. Other parents may say they want a larger center where their child can have various age groupings and progress through the program.
And so for all the programs, whether it's family child care or a larger center, we offer technical assistance, coaching, and other interventions that help them grow their capacity and quality.
Speaker 17
Amazing emphasis on meeting the needs of the family and the child and doing it in a positive way, creatively and flexibly. Thank you so much. I yield back.
Representative Grijalva of Arizona is recognized.
Raúl Grijalva
Thank you, good morning. Thank you to all the witnesses for being here. This subcommittee meets today to address a crisis deeply felt by families all over the nation, including in my home state of Arizona, the severe shortage of affordable quality healthcare, I'm sorry, healthcare is important too, child care. We're all going to cover all the bases today. When parents can't find care, they reduce their hours or leave the workforce, costing our national economy 122 billion annually and Arizona's economy 3.3 billion each year.
In Arizona, the child care supply has fallen 46% since 2002, leaving nearly 49,000 children under the age of five without a formal spot or a space in care. Center-based infant care now costs nearly $16,000 a year, while early childhood educators earn a median of $12.98 an hour, barely above the federal poverty level. We're asking workers to care for our children while paying them wages that make it difficult to support their own families. These are the workers on the front lines who identify developmental, learning, and health concerns early on to help our children grow to their full potential by connecting families with support as early as possible. I, like many parents, would not have been able to work without high-quality child care for my children.
Parents need to know that our children are safe, are cared for, and are learning. I believe child care is early childhood education, and working families deserve access to care and education that they can trust for their children, care that supports their children's developmental process and prepares them for success. New Mexico has pioneered universal child care, and we should recognize what that state has accomplished. Arizona has also demonstrated what state and local leadership are capable of doing to educate young children. In Pima County, the Pima Early Education Program scholarships, or PEEPs, bring together local, state, and federal and community resources to help income-eligible families access high-quality preschool.
But providing this critical support comes with real costs, impossibly difficult trade-offs for budgets. States should lead where they can, but they cannot be expected to shoulder the burden of national child care crisis alone. We need durable federal partnerships that stabilize the workforce and lower costs for families. Child care and early childhood education are not money-making business endeavors, which is why federal investment is so important. So I have a question.
Child care workers in Arizona are leaving the industry largely due to critical low wages, as I already mentioned. From 2018 to mid-2020, Arizona lost more than 1,000 providers. Ms. Melnick, based on your research, what are the most effective policy interventions to reduce turnover in the child care sector?
Hanna Melnick
Thank you for that question. I think there are two major components to reducing turnover. The first, as you said, is increasing compensation. The median wage nationally is $13 an hour for a child care worker. That means educators are literally choosing between doing the important work that they love, which is high stress, or going to a fast food job where they can earn both higher wages and have significantly lower stress levels.
And it's not just wages, but benefits. Again, 23% of early educators rely on Medicaid for their health insurance because they don't get it at work. But another big issue is working conditions. Child care workers get few breaks, they work long hours, and they have a very physically demanding job, and they do not get very much professional support in the very difficult work that they do, which is why we need to make sure we're also supporting the child care workers and the early educators with quality professional development. All of these things cost money, and the Congress can help provide adequate funding through the Child Care Development Fund and Head Start to make sure that both wages and professional supports are well-funded.
Raúl Grijalva
Thank you. Early educators are predominantly women of color, with 22% and 22% are immigrant women. They are the backbone of our child care system. How do current anti-immigrant policies threaten to destabilize this already precarious workforce and raise child care costs?
So, as you said, 20% of the early childhood workforce is immigrant women. I think it's very clear that the workforce is under severe stress already, so we need to do whatever we can to make sure that we are supporting rather than destabilizing the industry.
Thank you. I yield back.
Mr. Messmer of Indiana is recognized.
Speaker 20
Thank you, Mr. Chairman, and thank you for the witnesses for being here today. And also, Mr. Chairman, I want to echo your support of protecting the Head Start program. I've visited most of the Head Start providers in my district and see the great value they provide to the children and the families they serve. And with that, I'll start with Ms. Page. Iowa has taken a comprehensive look at regulatory burdens on the child care sector.
Can you give some examples of how regulatory reform have increased supply and created more opportunity?
Ryan Page
Yes, Governor Reynolds issued Executive Order 10 in early 2023, which required a review of all administrative rules to simplify, repeal, and obsolete ineffective or excessively restrictive administrative rules. We have modified child care licensing rules and regulations to slightly enhance capacity through adult-to-child ratio of two- and three-year-old children specifically, namely where Iowa was identified as an outlier in comparison to some other states. Yeah. Sorry about that. We also made moderate changes in staffing eligibility for persons under the age of 18.
We have found pragmatic solutions to ease regulatory burden on facilities operating in school buildings. I mentioned this before, namely before- and after-school programming, where they were being held to a higher regulatory standard for a gymnasium or lunchroom after school than they were during the school day. We focused on logical solutions, removing arbitrary barriers. We're currently focused on reducing state regulations for relative child care providers, as I mentioned, so that they meet the minimum regulatory requirements mandated under CCDBG, but not necessarily a higher burden at the state level. A grandmother watching her grandchild should never be subject to onerous regulation simply because she's accepting subsidy.
So, I will say that some of these, I can't definitively say that they have increased our supply, but I'm confident that our collective efforts for recruitment, retention, and sustainability with practical regulation increased and maintained our slots.
Kate Shanks
Okay, thank you. Ms. Shanks, Kentucky is a fairly rural state, just like Indiana, where I come from. How has local zoning reform changed the trajectory of child care options, especially in the rural areas?
Definitely, that's an important issue for us, and we created the Certified Child Care Community program, which is a set of resources, model ordinance, so that we can encourage local governments to make changes to their land use rules and ultimately become certified as a child care community. But I think it's the process that they go through that's most important because they can identify ways that they are maybe inhibiting the development of new child care facilities. So this is an important area for us, and we ultimately can imagine a scenario where we have communities in Kentucky that have achieved this status and where we can direct resources and programming to those communities. So we're working hand in hand. So you have a local government that's doing their share, rolling up their sleeves, addressing these particular problems, and then you have state-provided programs as well as federal-provided programs that could be directed in those particular areas.
You know, I work with an employer that's part of our Kentucky Collaborative on Child Care, that is our coalition of 40 different members solving child care issues, and his involvement in it is that he is in a rural community. And they are a large manufacturer in a rural community, and they struggle with child care.
And so that's going to create potentially those opportunities. This is where we developed a lot of opportunity through our Kentucky Collaborative on Child Care. It's our coalition that is just where we get a lot of these great ideas and consensus-driven approaches. Um, it is a a project that is funded by an incredible organization, Lift a Life Novak Family Foundation. I do want to mention the importance of nonprofits and foundations in this space as well, um, because this is where we can go to the collaborative, get help for these types of programs so that local governments can address these issues head-on, especially in our more rural parts of the state.
Speaker 20
Follow-up question on the, uh, Pike County Hospital, uh, employee center for the workforce employees. Is that open to other members of the community or or just to the workforce?
Kate Shanks
Their plan is to open it up. And so you have a university, you have banks, so their plan is to do that ultimately. Um, but you can imagine when you're recruiting doctors and nurses, I'm happy to come to your hospital, do you have child care? That is an important, that is a question they're getting, and that's exactly why they're doing this, so it can help the community beyond the hospital.
Okay. Thank you. I yield back.
Mr. Mannion of New York is recognized.
John Mannion
Thank you, Mr. Chair. Thank you to our witnesses for being here today. Child care access and affordability are issues that continue to be top of mind for so many families, including those that I represent. Uh, as you all know, states are at the forefront of addressing these challenges and working to improve policies of their own. Uh, I appreciate the models that have been shared today and agree it's helpful to look at what's working at the state level to see how federal investments can help.
I served in the New York State Senate at a time when child care needs across the state, including in Central New York, were significant. We were successful in rolling out programs to not only support existing providers expand, but also establish new centers in shortage areas that were deemed in child care deserts and micro-deserts. This was a hundred million dollar grant program for expansion, uh, and allowed those providers to increase, uh, the number of staff that they had and therefore the number of families that they could serve. We also passed legislation to incentivize employers to offer, as was just stated, on-site child care to their employees. And we dramatically helped expand universal pre-K across the state of New York, including in upstate New York.
That's what state leadership and true commitment to early childhood development looks like. My wife, who is, uh, spent many years screening kindergarteners, saw the value of students that were enrolled in universal pre-K or programs like Head Start. I'm glad that the other states, uh, have also enacted similar efforts, but we must also acknowledge that federal programs play an important role here and often help enable these innovations. Most notably, the Child Care and Development Block Grant, or CCDBG, actually provides the funding that states use to offer child care support directly to families and to invest in quality improvement. If we want to expand state-led child care initiatives, it's just as critical that we also strengthen bipartisan support for CCDBG.
I also want to briefly talk about Head Start. Another essential program that for decades has provided families with high-quality early childhood education. This administration is now proposing radical changes to Head Start that undermine quality and service standards, create needless confusion, and actually add more costs onto providers. I trust what I hear directly from the Head Start providers in my district and the families that I represent, and they're worried that some of these changes would be destabilizing and put programs at risk. The vast majority of Americans and the vast majority of the people that I represent support Head Start and see child care as a critical part of the affordability crisis.
So why, I ask, would we jeopardize a program we know is working? So while I'm glad that we're looking at state-led solutions today, I just want to emphasize that they're not always inseparable from the choices made in Washington, which lately have been moving us in the wrong direction. My questions are for you, Ms. Melnick. Um, we've already touched upon several specific examples of states innovating to improve access, affordability, and quality of child care. So, how can the federal government better support these improvements and help scale these policies?
Hanna Melnick
Thank you for the question. I think it's clear that for many of the state innovations that we have talked about, they have begun with federal funds. In infant and toddler care especially that is true because that is such an intensive, labor-intensive work and it is expensive. And so, for example, the work that I talked about in Alabama where the state is providing professional coaching, instructional coaching for infant and toddler teachers, that work was made possible because of the preschool development grants that gave the state some time to think about quality. It also was a result of the Early Head Start-Child Care Partnerships that brought a focus to how we can expand the quality of Early Head Start to more child care providers.
And similarly, the compensation initiatives that I mentioned in North Carolina and particularly in Virginia were jump-started with federal funds. And in Virginia, those pandemic-era funds are about to or have expired and that's leaving the programs in jeopardy. So we need to continue to fund these opportunities where states can then take the lead.
Burgess Owens
Thank you, Mr. Chair. And this is again a very, very important state conversation. Child care is a topic that is key right now to us and innovation from bottom-up appears to be a solution that's working. And I want to kind of focus on that a little bit. Ms. Page, you mentioned Iowa's relationship with the business community and many of the innovative efforts you've had.
What are some of the lessons learned by both the state and small business owners as you guys have actually innovated through this process?
Ryan Page
Thank you for that. Um, you know, when we had COVID-era funding through CARES, CRRSA, and ARPA, the state took a lot of unique opportunities to try innovative ideas that we hadn't tried before. And I think that's what we've heard was the benefit of some of those pandemic-era funds. One example is the Business Incentive Grants that was done in partnership with the Iowa Workforce Development. We used both state and federal funding streams for that.
Some businesses chose to open and operate their own child care programs. Some chose to contract with child care businesses to operate a program on-site. And then we also had those that supported local child care facilities by asking them to hold slots and then provide financial support for eligible employees.
We found some projects that had more success than others and part of that was just the local environment at the time. Right now, we're very committed to our community development specialist work that is being championed by our child care resource and referral partners. They are fully funded by HHS and it builds on a previous contract that we had with the Iowa Women's Foundation that worked on business solutions and partnership supports at the local level. For example, one regional area partner partnered with the local chamber and they conducted a survey with businesses on commuting effort for employment, annual expenditures on workforce turnover, and what expenses were related to the lack of access to child care in that community. They've engaged community members and businesses to learn about needs and capacity using our child care connect to understand the supply and demand data in the background.
And so we really want to educate our businesses about the types of child care resources that are available to them and to their employees and then share data that helps them understand the complexity of the landscape of their workforce. They can only build capacity for the workforce that they serve when they understand the data behind it.
Burgess Owens
Thank you. Ms. Jenks, earlier you mentioned the return of investment for businesses and I think it's worth for us all to repeat that because it is all about return of investment. And the other thing is, other than venues like this, is there a best practice sharing between states to understand what really works and so they can kind of buy into that and move forward?
Kate Shanks
Absolutely, and I will reiterate that the economy is very important and the work of our child care policy work is very important to workforce participation, which is important to the economy. Whenever I talk about our work on jobs and policy in that regard, I always tell people you can have all the jobs, but if you don't have the people in them, you don't get economic growth. And we want Kentucky to achieve their economic, our economic potential, but we want Kentuckians to achieve it as well. And so we spend just as much time working on the job side of the equation as we do on the workforce side of the equation. And I think that that's really important.
In terms of how states can share, you know, we have some pretty informal networks. We have great organizations that support our work, that bring people together. We're part of a fellowship specifically in that regard. And we, it's a really, I think, close-knit group of people that work in the child care space. And I think the reason for that is that it's a lot of work and there's a lot of research that needs to go into it.
You know, we're working on, for example, studying the methodology on supply and demand and making sure that we are not overstating supply, making sure that we better understand demand. And we're seeing some things in other states that we can learn from that they're going, we're going to bring back to Kentucky and develop that methodology. We worked with the Metro United Way and found that there's actually a difference between licensed capacity and true capacity, almost 30% in the study that they did. And so I think that there's a great opportunity here for us to work with each other because as we innovate, we learn. Our employee child care assistance program, we've learned from other states.
We are now contracting that out to a third party specifically to expand that program. We've learned that from other states. So there are some informal networks that we are a part of, but any opportunity that we can come together and learn from each other, I think is important.
Jude White
Thank you. Ms. Whitehead, a real quick question, I don't know if we have time, but the last 20 seconds. The innovation of retaining child care workforce through wages and professional development, how, if you can briefly describe what you guys are doing in that area?
Yes, absolutely. Thank you. So since 2019, we have made available the wages salary supplement program statewide. And that is a model that can be, you can obtain the license and provide that, that resource in your state. And what it does is a member of the child care workforce will apply for this salary supplement and the level of their supplement is based upon their level of professional and academic advancement.
So it encourages that continuous professional development, but it also is only awarded to the worker as they maintain their employment with their provider. So it's the dual benefit of encouraging that continued professional development while also promoting the stability of the workforce and continuity of care for children.
Speaker 25
Thank you so much. I yield back. Representative Hayes of Connecticut is recognized.
Jahana Hayes
Thank you. Thank you all for being here today. I am listening and I know very well what you are all speaking about today. I worked in a daycare for many years. I was the head teacher in the toddler two room.
And I'm just thinking about that experience because in the state of Connecticut I made a little bit more than our minimum wage at the time, but I did not have healthcare, I did not have any other benefits, and this was not babysitting. This was child development. It was assessment. It was preparation for school. It was identifying problems and targeting intervention.
It was all of those things. And the saddest part of that whole experience, although I loved the work and it was the springboard that led me to pursue a career in teaching, was that while I was pouring into other people's children, my own children were being cared for by a patchwork of people in my community, by my grandmother, by friends, by relatives, in a very haphazard way. So they were not receiving the benefit of those things. Connecticut did have a program back then which I was able to access. It was called the Care for Kids program.
However, even with a program like that, the voucher was not sufficient to pay for the cost of a high-quality childcare center like the one that I worked in. My weekly salary wouldn't even cover what it would have cost to enroll one of my children in that program. So I was limited to a home daycare or a community-based setting, which so many people are experiencing today. And the fact that that has not changed is and should be the shame of our nation. When we talk about helping parents to be self-sufficient and not relying on government assistance, this is probably the best thing we could do is to ensure that their children are safe so that they can pursue a career, so that they can work and give back and invest in our communities.
My question today builds on that program that we have called Care for Kids. It's a partnership between state and federal, they use federal funding for this state-led initiative, and they use eligible resources to help families afford childcare by giving them a voucher. You know, families have to check in, there's lots of things. But it's something that we absolutely can expand upon and grow so that, I mean, every decision about every job I ever took was based around making sure that my children were safe. And that hasn't changed.
And we have the ability to do so much. And then I think on the other side, the other thing I'll add to that is even as a high school teacher, I could identify the students who had early childhood interventions because those skills grow and develop and follow them through the years. So reaching our kids early, you know, doing social interaction and reading interventions and speech interventions, all of those things set our kids up for success. So it's not just babysitting. It is really the number one economic driver that we have.
My question is for you, Ms. Melnick. In Connecticut, the Care for Kids program is an example of how federal CCDF resources can be used to help develop effective state-led solutions to helping support working families. What opportunities do you see for states to build upon these models, and how would additional federal investments allow states to expand successful programs like Care for Kids and implement new strategies to address the childcare crisis? Because I don't care how many businesses you bring to a community, like I said, if parents don't feel that their children are safe, they cannot work.
Hanna Melnick
Absolutely. So I think what the state, what states can do with federal dollars is to really expand access and just make it easier for parents to access the care that they need instead of having to jump through hoop after hoop, which in many cases keeps families out by design because we have to ration limited resources. So what we're seeing in Vermont and New Mexico, as I mentioned, is that they are breaking down those eligibility barriers for families, making child care universal so that it's something you know you can depend on. Even when you change your job, you know your child can continue with their caregiver. You don't want to have to have the child leaving a place where they feel safe and comforted just because you have a job change or temporary change in your life.
And that's when they might need it the most. And so making sure that they can make to to make programs as universally available as possible.
Jahana Hayes
You just made me smile two times by saying universal child care and then doubling down on how important that universal care is because it is literally a step that we need to take, that this committee needs to lead on to make sure that it is a part of any agenda moving forward because that's how we get our economy growing. And with that, I yield back.
Glenn Thompson
Uh, thank you, Chairman. Thank you, ladies, for, uh, bringing your experience and your passion for child care, uh, to this committee. Uh, very much appreciate that. Uh, as I, uh, I think you've done a great job of laying out just how important that is, you know, to the, uh, to the family, to to intellectual development. Uh, as I work in my district on those issues, but on issues also like economic development and and, uh, workforce development, uh, the two things that rise to the top almost in every conversation, uh, is, uh, child care and housing.
You know, we have it's an exciting time. We have employers that are expanding, new entrepreneurs, actually jobs are growing, uh, but especially in rural areas like I represent, and I represent a third of the landmass of the state of Pennsylvania, a lot of our communities we don't have the we don't have the child care, uh, and and the housing is a recurring theme as well. Uh, I will say for my colleagues here, if you if this issue is important to you, I would hope you would support the reauthorization of the Community Services Block Grant, HR 3131, uh, that supports Head Start. Uh, it has 31 co-sponsors at this point. Uh, this committee needs to be marking that bill up.
Uh, it is long overdue. I think it last was reauthorized was in the nineties, I believe. Uh, Ms. Page, what benefits did removing income limits for child care workers attain that, uh, led your state to codify the Child Assistance Program for the Workforce Pilot Program into state law?
Ryan Page
Yes, so we started that as a pilot about three years ago. We wanted to make sure that we were going to see the workforce recruitment retention that we thought we were going to see when we, uh, brought the Child Care Assistance for the Workforce Program. So that was codified into law just this last legislative session. And we've served, uh, at least 2400 people so far. That's 2400 people in the child care workforce that were not in the workforce before, which is creating sustainability for our child care programs as well.
We really did see, uh, that this was crucial for program stability, stability for children and families, and then that year-over-year retention as well, uh, of, um, the people that were eligible in the first year, they continued to work in child care in the second year, and they've continued to work in child care the third year.
That's sustainability. And we had child care providers, advocacy partners, and bipartisan support at our legislative body. And it's good investment.
Glenn Thompson
Very good, thank you. Ms. Shanks, as you know, Kentucky was the first state to make all employees at licensed child care centers eligible for child care assistance regardless of income. How did this workforce incentive come to fruition, and what encouragement would you give to other states about this innovation?
Kate Shanks
It's definitely a popular program that we offer. It started in 2022 and it was codified in statute this year with the passage of House Bill 6. As I mentioned, 5,300 Kentuckians took advantage of that last year. And so if you think about ratios in the classroom of four or five to 12, that's a lot of families that you're impacting by serving those people. And it is a retention and a recruitment tool.
It's very unique to our child care services and it's very popular. And so it is something that we do recommend. I believe there's nine states that are participating in it, perhaps at different levels or conditions. But I do think it's something important. Our General Assembly has been very interested in it and in supporting it, and they appropriated around $17 million in support of it here recently.
And so it's something that they're tracking closely too. And so we will continue to advocate for that.
Speaker 34
Well, congratulations to your state for taking leadership with that. Ms. White, what measurable benefits has Tennessee seen from the Smart Steps Plus program, which expands child care support to middle-income workers?
Jude White
Yes, thank you. We were delighted to follow the leadership of our governor's office about two years ago to get dedicated state dollars to provide the Smart Steps Plus program. And so that is a program that's designed to address the fiscal cliff, which is something that is discussed often. And that's the precarious situation that a family might be in if they are accessing public benefits and then see perhaps a salary increase or a marriage that then makes them ineligible. And so then as they are getting back on their feet, they're losing access to some of those resources.
And so the Smart Steps Plus program is designed to provide payment assistance for those who have been on our Smart Steps program as they cross that 85th percentile of state median income to continue to provide that child care payment assistance so they can maintain their employment, build that employment history, and continue to advance professionally.
Speaker 33
Well done. Thank you very much. Ranking Member Scott of Virginia is recognized.
Robert Scott
Thank you, Mr. Chairman. Mr. Chairman, what we've heard is that workers aren't being paid enough and the cost to parents is too high. Unless we're concluding that the problem is that the day care centers are charging or making too much money, we have to deal with, and there's no evidence of that, most of them are nonprofits anyway, the only way we can solve that is obviously come up with a subsidy to try to increase the pay and reduce the price. Ms. Shanks, can you discuss why adequate pay is important for quality education and retention of teachers?
Kate Shanks
Yes, thank you for that question. Quality is of course very important to us, it's very important to families. And I would say in response to your question, we look at the programs that the federal government provides, that you all work on here, as being very much foundational. And then we bring in the state support through our advocacy at the state level where we can provide the child care assistance program with state funds, where we ensure up to 85% of state median income families are eligible for child care assistance. And then of course the employee child care assistance program, which is the cost-share model, which is funding from the state as well.
And so we do have different layers essentially of what we can bring to the particular problem around cost to help families with affordability and to help providers provide the workforce that they need so that they can fill those positions. Quality is key, and you mentioned quality, and we do have some plans to update our quality rating system in Kentucky.
It was part of our legislation that we passed earlier this year. And then there could be some economic incentives, there are economic incentives, but there are some benefits to the providers as they reach those different levels of quality within our All Stars program. And so a lot of things happening at the state level to support that.
Robert Scott
Thank you. Ms. Melnick, we are aware the Child Care and Development Block Grant covers support for a lot of eligible people, but only 16% of those eligible, and that's those under 85% of the state median wage as a as a maximum, only 16% of those get assistance. A lot more actually need assistance, but only 16% of those eligible. If you add up all of the state incentives, what percentage of the need are we meeting, and would just starting with expanding the CCDBG be an important first step?
Hanna Melnick
So I don't know the exact percentage because but it's so clear that the need is extremely high. It is especially true for children birth through age five and infants and toddlers in particular. I think it would be hard to argue that states would not very gladly accept more support so that they can both expand access but also expand the per-child rate. Both are needed in order to make high-quality early care and education more accessible.
Robert Scott
What can be done to ensure that child care providers include quality education as part of their program? And education is an important component of quality child care.
Hanna Melnick
I think we have so much more we can do to support the professionals who are caring for our children. They need instructional support in the the day-to-day work that they're doing, so that job-embedded professional development. Right now, a lot of the professional development is on providers' own time. They have to leave their their business and pay for it out of their own pocket, often attending trainings on nights and weekends. So having state programs like often provided through quality rating and improvement systems where you have someone coming in to support a provider in their home, and that's particularly important for being able to support children with disabilities who often have needs that providers really want to be able to support but but they can't on their own.
Robert Scott
Can you in the final less than a minute say why Head Start is so important and why it should not be abolished?
Hanna Melnick
Of course. Head Start plays an incredibly important role in our country in making sure that we are providing high-quality early care and education to our youngest children who are most in need. And the program is very clearly beneficial for children with effects that last into school and later in life, and that's why we need to make sure that we're protecting this investment.
Ryan Mackenzie
Representative Mackenzie of Pennsylvania is recognized.
Thank you, Mr. Chairman. I want to start by thanking each of our witnesses for the work you do in your states and your commitment to child care programs. The Child Care Development Block Grant hasn't been reauthorized in over a decade, and according to the Bipartisan Policy Center, this means 4.2 million children who have a potential need for care have no formal slot within a reasonable drive from their home. It also means that there will be an estimated $216 billion to $329 billion in lost earnings, productivity, and tax revenue over the next decade.
And 60% of caregivers are missing work, reducing their hours, or changing jobs because they don't have access to care. To address this issue, I introduced the Child Care Modernization Act with a bipartisan group of my colleagues. And my bill would tie provider payment rates to the true cost of care, create new supply and facility grants, and most importantly, give states the flexibility in how they manage their child care programs. It's clear through the witness testimony that a federal one-size-fits-all approach will not necessarily help the children and parents that we are looking to help, but in fact, this state approach, giving the block grants to the states, giving them the flexibility they need to implement the programs, would be the best path forward and the best approach. So my question is for Ms. Page.
I noticed in your testimony that you talked about Child Care Connect, and as I understand it, it's a tool that helps parents identify child care centers that fit their needs. As I mentioned, my bill, the Child Care Modernization Act, would tie provider payment rates to the true cost of care. Could you talk about some of the benefits that you've seen Child Care Connect provide and how it could be used as an estimate of cost of care in your state?
Ryan Page
Absolutely. So the first part about Iowa Child Care Connect is really going back to how this is supportive for families, right? So it's families are able to access available information, near real-time availability of child care that meets their needs related to age, location, quality, center versus home, etc. So that's the goal that we are meeting for families. What we really want to talk about too is the data around supply and demand that we have for dashboards that are available to not only the state, but local communities as well.
And so when we're able to identify licensed capacity of child care facilities versus operational capacity versus desired capacity, those are three different numbers for our child care programs. And before we start investing in some of like facility grants or supply grants, we want to understand that data landscape first. So we want to understand that information, provide that information so that we're using our funding appropriately. The other thing that we obviously do as required by CCDBG is the market rate survey. Some states use alternative methodology.
We're able to use the information around supply and demand, family need using vital statistics and birth records to start talking about what is the true cost of care, what do communities need so that we can start providing those recommendations to the Iowa legislature who then help us drive rates.
Ryan Mackenzie
Okay, fantastic, and I really agree with your position on understanding that supply and demand dynamic and understanding those different categories. We see that all the time in our local community. They say they're licensed to have so many students in their facility, but then there are impediments to actually meeting that number based on if they actually have the providers or other resources available to actually hit that licensed number. So thank you for that information. I'll go to Ms. White next.
The goal of the Child Care Modernization Act is to give states flexibility in how they administer their child care programs. Like other states, Tennessee is comparing providers' actual enrollment versus desired enrollment, similar to what we were just talking about here. And so tell us how you view that difference in the data that you're seeing and how you can use it to match child care needs.
Jude White
Yeah, absolutely, thank you. So we are focused on that data. Our licensing staff go out to our providers on a quarterly basis and get direct information about their actual enrollment versus the provider's desired enrollment, which as you said, is even different than their licensed capacity. And so to get a more true picture of the child care landscape in Tennessee, we want to collect and understand that data. And then our pre-licensure unit uses that data as they're working with potential providers to help them think through whether or not the area where they want to open might be saturated with a particular type of child care.
So they may want to think about the ages that they're serving or the hours that they're operating so they can ensure that they will actually fill a need in their community. So that data is critical to understanding how best to invest our resources so the providers that are opening are sustainable and that our existing providers have a financial model that allows them to survive.
Ryan Mackenzie
Thank you again to all of our testifiers. Again, this is the substantive discussion that we're looking for in the child care space, and I'm fully confident we can find bipartisan solutions to address the issue. I yield back, Mr. Chairman.
Aaron Bean
Thanks very much. I'll now recognize Ranking Member Bonamici for a closing statement.
Suzanne Bonamici
Thank you, Mr. Chairman. And thank you to the witnesses for being here, for your testimony, for your expertise, but also for emphasizing the importance of access to quality, affordable child care. And today's hearing shows that many states are finding creative ways to expand access to child care and support child care providers. We should learn from those successes, absolutely. We certainly appreciate that.
But again, innovation cannot replace investment. Families still struggle to afford care, providers struggle to stay open, child care workers remain underpaid. We also heard that child care is not just a family issue, it's an economic issue. When parents cannot find or afford child care, they're forced to cut hours, turn down opportunities, or leave the workforce. And that hurts families, employers, and the economy.
I also want to make a point that both Ms. Shanks and Ms. White mentioned, and that's about removing red tape. I'm all about finding smarter, better ways to do things, and it's why I encourage this committee and this Congress to take up and pass a bipartisan bill, I think Mr. McKenzie is still here, that we are co-sponsoring, the Early Childhood Nutrition and Improvement Act. The Child and Adult Care Food Program supports child care providers who serve healthy meals to millions of children across the country, but it needs to be updated and it needs to be simplified, and that's exactly what this bipartisan bill does. It reduces paperwork requirements, streamlines the program, and authorizes reimbursement for an additional meal or snack to children who are in care for longer periods of time. So we could do that.
It would make a difference because there are many providers who aren't using the program now because it's too complex and bureaucratic. So that's one thing we can do right away. So I'm encouraging leadership to bring that up. I also agree with Mr. Thompson that we could modernize the Community Service Block Grant program. In Oregon and across the country, community action agencies run, often times, the Early Head Start and Head Start programs.
They're doing important work. That program needs to be modernized as well. So we know that the federal government can make a significant difference for the people we represent and for the economy by helping states build on what works. We saw during the pandemic that federal investment stabilized providers and kept care available for families. We can continue that progress and also promote strong accountability in these programs.
That's important. But at the end of the day, we should not have to choose between innovation and investment. We need both. Today's children are tomorrow's leaders. The Child Care for Working Families Act would help make care more affordable, expand access, and invest in the workforce.
I hope we can work together to give states, providers, children, and families the support they need. And again, Mr. Chairman, thank you, and thank you to the witnesses. I look forward to continuing to work on this important issue, and I yield back the balance of my time.
Speaker 1
Thanks very much and thank you to all our witnesses. A point of consensus I think that's emerged from this hearing is that the Child Care Development Block Grant should be reauthorized. We've heard that from Ranking Member Bonamici, we've heard it from Representative Thompson. Representative McKenzie has a bicameral, bipartisan bill to reauthorize and modernize the program. And so if House leadership is looking for something to do in September, here's something that we can do that would really address the concerns of working families, that would allow for these child care grants to go a lot farther.
So I will call upon House leadership myself to make this a priority, to get this passed, to get the reauthorization done by the end of this term. I think that we've heard some great examples today of programs across the country that are innovative, that are really helping families and the entire child care sector in an important way. I think at the federal level we of course have the block grant which is indispensable. The other lever we have is the tax code. We had some very good tax policy pass last year when it comes to child care to expand and make permanent credits related to the child tax credit, to child care, to employer-provided care.
Of course these credits are not self-executing and they are only valuable if folks take advantage of them. So I think that there's more that we could do to spread awareness as to how these can be used. But what I think this hearing has done as well as our last one where we had various innovative employer-based programs is really highlight what's working. We've heard from about programs in Tennessee, in Kentucky, and in Iowa, as well as we heard examples of other programs in North Carolina and Alabama and Oregon. And so to the extent that we can show innovative programs that are working well and inspire others across the country to adopt similar programs, then we can see the federal support we do provide catalyzes a lot more change and provides a lot more opportunities to families who really need it right now at a time when costs are so high in so many ways and for child care in particular.
So thank you again for our witnesses. Without objection, there being no further business, the committee stands adjourned.