Child care was a huge topic of discussion during the 2024 legislative session. Advocates appealed to elected officials to help them understand that safe and reliable child care makes it possible for families to be part of the workforce and benefit the whole community. Legislators also examined the price tag that would be attached to stabilizing Kentucky’s child care industry, and that price tag was not small. 

In previous years, most of the child care funding in Kentucky came from federal dollars through the Child Care and Development Block Grant. In order to receive those funds, Kentucky had to contribute a funding match through budget general funds. For years, Kentucky contributed the minimum amount of funding possible; however, this year definitely changed that pattern. The 2024 General Assembly added an additional amount per year almost totaling $70 Million. That is a monumental investment, and something that Kentucky has never done before.

The question is “Will that amount be enough to sustain child care?” Many working in the field of child care believe that those funds will still fall short.  

Many child care advocates started off the legislative session asking for a minimum of an additional $150 Million per year in order to sustain programs that were created with the one-time federal funding that was distributed during the pandemic and to create programs that would increase access to child care throughout the state. Although maintaining the current programs was a huge priority, it is important to remember that 79 of Kentucky’s 120 counties are currently considered child care deserts and do not have enough child care for the working families that need it. Although this funding amount seemed like an enormous request, the return on investment would be seeing more parents and caregivers participating in the workforce and therefore, stimulating the economy.  

The Child Care Assistance Program (CCAP) – a subsidy program for low income families needing help with the cost of child care – received a large portion of the new funding in the state biennial budget, but many child care programs are worried about support to maintain competitive wages for their employees. Data from the 2023 National KIDS COUNT Data Book shows that the average wage for a child care provider in Kentucky is $12.39 per hour and that 98% of professions make higher wages than child care providers. The one-time federal funding allowed child care providers to increase their wages and keep employees, but without supplemental funding, child care programs will have to decide between increasing tuition dramatically, reducing staff wages, or closing their doors.

There were successes during the 2024 legislative session: 

  • The CCAP income exclusion for child care providers – free child care for child care employees working at least 20 hours per week in a child care program – was financed for two more years. Kentucky was the first state to implement this program, and other states across the US.. are quickly copying Kentucky’s model in order to help child care programs increase their staffing numbers. 
  • The legislature also maintained funding for Kentucky’s early childhood education scholarship program, which is another key to having a qualified child care workforce.  
  • Also, the state budget maintained the CCAP reimbursement rate at the 80%, which means that when a family uses the child care subsidy program, their subsidy will cover the full cost of care at 80% of the child care programs in the state, allowing the family to choose from a variety of high quality programs.  
  • House Bill 561, sponsored by Representative Samara Heavrin and now signed by the Governor, will encourage communities to change their zoning laws to allow more family child care homes. It also removed the “pilot” status for the Employee Child Care Assistance Partnership program, which allows employers to support employee access to child care.

While Kentucky was in the midst of the state legislative session, the federal government was also making some changes to child care. New regulations were passed to the Child Care and Development Block Grant that include positive changes for families but a slightly higher price tag for states. The three largest components include:

  • Child care subsidies will permanently be paid on enrollment, not attendance.
  • Child care subsidy copays for families will be capped at 7% of family income.
  • States will simplify the subsidy application process.

The federal government also increased the budget for child care in order to provide more funds for these new requirements; however, the amount of funding needed will depend on the state’s subsidy enrollment.

At the state level, the Cabinet for Health and Family Services will be using these new funds from the state and federal government to provide services to as many families and child care programs as possible. Since no policies on child care subsidies were passed, then the budget designates the minimum amount of funding that must be offered. For example, the state budget designated funds for child care subsidies for families at 160% of the Federal Poverty Level or below; however, based on the number of families enrolled and the combination of state and federal funding, the Cabinet for Health and Family Services may be able to serve many more families than the minimum requirement.  

As Kentucky moves forward after the legislative session, it is going to be essential to monitor the financial stability of child care programs throughout the state and to watch for child care closures in local communities. If the new increase in state funding is not enough, the state will see a reduction in child care offered throughout the state. A reduction in care will have a significant impact on working families and businesses, and it will be essential for families and businesses to reach out to their legislators and tell them about the impact on their constituents. 

This year’s increase in child care funding was a huge step in the right direction, but it is just a first step in making sure that Kentucky families and children have the high-quality child care they need to be successful. Child care providers were “essential” long before the pandemic – they keep our children safe, nurture their curiosity and prepare them for a lifetime of learning and growth.

Join us in celebrating child care providers across the Commonwealth on May 10th for National Provider Appreciation Day!