Order Code RL32817
CRS Report for Congress
Received through the CRS Web
Child Care Issues in the 109th Congress
Updated August 2, 2005
Melinda Gish
Specialist in Social Legislation
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress
Child Care Issues in the 109th Congress
Summary
Federal support for child care comes in many forms, ranging from grant
programs to tax provisions. Some programs serve as specifically dedicated funding
sources for child care services (e.g., the Child Care and Development Block Grant
(CCDBG)), while for others (e.g., Temporary Assistance for Needy Families
(TANF)), child care is just one of many purposes for which funds may be used. In
many cases, federal programs target low-income families in need of child care
assistance, but in the case of certain tax provisions, the benefits reach middle- and
upper-income families as well. This report provides an overview of federal child
care and related programs, and tracks issues being addressed by the 109th Congress.
The 109th Congress inherited several child care-related agenda items from the
previous Congress(es). For example, the CCDBG and TANF block grants have been
due to be reauthorized since the end of FY2002, and Head Start since the end of
FY2003. In all cases, legislation has failed to make its way to enactment in law.
Mandatory child care funding, which is linked legislatively to the TANF
reauthorization, has instead been extended on a temporary basis numerous times,
with the most recent extension (H.R. 3021, running through September 30, 2005)
signed into law as P.L. 109-19 by the President on July 1, 2005.
Funding for most child care and related programs is provided through the annual
appropriations process, either under the Department of Health and Human Services,
or the Department of Education. Shortly following the start of the 109th Congress,
the President, on February 7, 2005, released his budget request for FY2006. With the
exception of the Head Start program, for which the President requested a slight
(0.7%) increase, and two programs that would be eliminated (the Even Start program
and Early Learning Fund), the FY2006 budget request would provide the same
rounded level of funding as in FY2005 for the child care-related programs covered
in this report.
The FY2006 budget proposals in areas related to child care and early childhood
development continue to be framed in the context of the Administration’s Early
Childhood Initiative — “Good Start, Grow Smart” — which was initially launched
in April 2002. The initiative emphasizes the importance of promoting school
readiness, a key focus of the President’s Head Start reauthorization proposals. In
efforts to promote school readiness among pre-school children, there is also a
growing emphasis on better coordination of early childhood programs, which include
most of the federal programs described in this report, as well as state pre-
kindergarten programs and other state-funded efforts.
This report will be updated to reflect relevant legislative activity, including
reauthorization bills S. 667, H.R. 240, and S. 525.
Contents
Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Federal Child Care-Related Programs and Tax Provisions . . . . . . . . . . . . . . 2
Child Care and Development Block Grant (CCDBG) . . . . . . . . . . . . . . 2
Temporary Assistance for Needy Families (TANF) . . . . . . . . . . . . . . . 3
Child and Adult Care Food Program (CACFP) . . . . . . . . . . . . . . . . . . . 3
Social Services Block Grant (SSBG) . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Head Start . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
21st Century Community Learning Centers (21st CCLC) . . . . . . . . . . . . 5
Even Start . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Individuals with Disabilities Education Act (IDEA) Programs . . . . . . . 5
Early Learning Fund/Early Learning Opportunities Act Program . . . . . 5
Early Reading First . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Early Childhood Educator Professional Development . . . . . . . . . . . . . 6
Child Care Access Means Parents in School (CAMPIS) . . . . . . . . . . . . 6
Dependent Care Tax Credit (DCTC) . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Dependent Care Assistance Program (DCAP) . . . . . . . . . . . . . . . . . . . . 6
President Bush’s FY2006 Budget Request . . . . . . . . . . . . . . . . . . . . . . . . . . 8
CCDBG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SSBG and TANF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Head Start . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
21st Century Community Learning Centers . . . . . . . . . . . . . . . . . . . . . . 9
IDEA Grants for Infants and Families . . . . . . . . . . . . . . . . . . . . . . . . . . 9
IDEA Preschool Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Even Start . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Early Learning Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Child Care Access Means Parents in School (CAMPIS) . . . . . . . . . . . 10
FY2006 Appropriations — In Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Administration’s Early Childhood Initiative . . . . . . . . . . . . . . . . . . . . . . . . 11
Legislative Activity in the 109th Congress . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Child Care and Welfare Reauthorizations . . . . . . . . . . . . . . . . . . . . . . 12
Head Start Reauthorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Other Child Care-Related Legislation . . . . . . . . . . . . . . . . . . . . . . . . . 15
Hearings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
List of Tables
Table 1. Funding for Federal Child Care and Related Programs,
FY2001-FY2005 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Table 2. Bush Administration’s FY2006 Funding Request Compared
with FY2005 Funding for Select Programs . . . . . . . . . . . . . . . . . . . . . . . . . 10
Table 3. FY2006 House-passed and Senate Committee-passed
Funding Levels Compared with FY2005 Appropriations
and President’s Request for FY2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Child Care Issues in the 109th Congress
Recent Developments
On July 14, 2005, the Senate Committee on Appropriations amended and
reported H.R. 3010 (S.Rept. 109-103), a bill to make FY2006 appropriations for the
Departments of Labor, Health and Human Services, and Education. For funding
amounts proposed, and how they compare to the version of H.R. 3010 passed by the
House on June 24, 2005, see FY2006 Appropriations — In Process in this report.
On July 1, 2005, legislation (H.R. 3021) to temporarily extend funding and
program authority for TANF and mandatory child care programs was signed into law
(P.L. 109-19). This law marks the tenth temporary extension, and applies through
September 30, 2005.
On May 25, 2005, the Senate Committee on Health, Education, Labor, and
Pensions approved its Head Start reauthorization bill, S. 1107, by voice vote. One
week earlier the House Committee on Education and the Workforce unanimously
passed (48-0) its own reauthorization legislation, H.R. 2123, as amended.1
On March 15, 2005, the House Ways and Means Subcommittee on Human
Resources approved H.R. 240, a welfare reauthorization bill that includes an
additional $1 billion (over five years) in mandatory child care funding (above the
current annual level of $2.717 billion). The approval vote (8-4) followed party lines,
reflecting only Republican support. Earlier that same day, the Education and
Workforce Subcommittee on 21st Century Competitiveness conducted a hearing on
welfare reauthorization: “Welfare Reform: Reauthorization of Work and Child
Care.” (The Education and Workforce Committee also has jurisdiction over some
provisions included in H.R. 240, but has not yet taken up the legislation.)
On March 9, 2005, both the Senate Finance Committee and the Senate Health,
Education, Labor, and Pensions Committee (HELP) approved and ordered reported
bills to reauthorize welfare and child care. The Senate Finance bill (S. 667) includes
an additional $6 billion over five years in mandatory funding for child care (above
the current annual level of $2.7 billion), while the Senate HELP bill (S. 525) would
reauthorize the Child Care and Development Block Grant Act itself, including
program rules, and would provide an increased authorization of discretionary funding
for the program ($2.3 billion in FY2006, rising to $3.1 billion in FY2010). Both bills
received bipartisan support. For more information on the legislation, see Child Care
and Welfare Reauthorizations, later in this report.
1 For more information on these reauthorization bills, and additional information on Head
Start, see CRS Report RL30952, Head Start: Background and Issues.
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Federal Child Care-Related Programs and Tax Provisions
Several federal programs support child care or related services, primarily for
low-income working families. In addition, the tax code includes provisions
specifically targeted to assist families with child care expenses. Descriptions of those
programs and tax provisions follow, as does Table 1, which shows funding (or
estimated revenue loss or obligations where applicable) for the programs and tax
provisions for the past five years. In many cases, other Congressional Research
Service (CRS) reports are referenced as sources for more detailed information about
individual programs. Several programs are due for reauthorization during the 109th
Congress (i.e., Child Care and Development Block Grant, Temporary Assistance for
Needy Families, and Head Start), and readers should be aware that this report does
not attempt to cover all issues connected with each of those reauthorizations.
Child Care and Development Block Grant (CCDBG).2 The primary
federal grant program funding child care is the CCDBG, which was created in 1990,
and reauthorized and substantially expanded in 1996, as part of welfare reform. The
CCDBG has been due to be reauthorized since the end of FY2002, and remains on
the agenda in the 109th Congress. (See the Legislative Activity section of this report.)
The CCDBG is administered by the Department of Health and Human Services
(HHS), and provides formula block grants to states, which use the grants to subsidize
the child care expenses of families with children under age 13, if the parents are
working or in school and family income is less than 85% of the state median. (In
practice, many states establish income eligibility levels that are lower than this
federal threshold.) Child care services are provided on a sliding fee scale basis, and
parents may choose to receive assistance through vouchers or certificates, which can
be used with a provider of the parents’ choice, including sectarian providers and
relatives.
States receiving CCDBG funds must establish child care licensing standards,
although federal law does not dictate what these standards should be or what types
of providers must be covered. In addition, states must have health and safety
requirements applicable to all providers receiving CCDBG subsidies that address
prevention and control of infectious diseases, building and physical premises safety,
and health and safety training for care givers. However, federal law does not dictate
the specific contents of these requirements.
The CCDBG is funded through both discretionary and capped entitlement grants
(referred to in combination as the Child Care and Development Fund (CCDF)), and
state maintenance-of-effort (MOE) and matching requirements apply to part of the
entitlement funds.3 States must use at least 4% of their total funds to improve the
quality and availability of child care, and according to statute, must target 70% of
entitlement funds on welfare recipients working toward self-sufficiency or families
2 For more information, see CRS Report RL30785, The Child Care and Development Block
Grant: Background and Funding, by Melinda Gish.
3 For more detailed information on the CCDF financing structure and spending trends, see
CRS Report RL31274, Child Care: Funding and Spending under Federal Block Grants, by
Melinda Gish.
CRS-3
at risk of welfare dependency. However, because all families falling below the 85%
of state median income requirement can be categorized as “at risk,” the 70% targeting
of the welfare or at-risk population does not necessarily mean welfare families must
be served. In theory, all funds may be used for low-income, non-welfare, working
families. However, state plans indicate that many states guarantee child care to
welfare families. No more than 5% of state allotments may be used for state
administrative costs.
For FY2005, the Consolidated Appropriations Act (P.L. 108-447) provides $2.1
billion (minus an across-the-board rescission of 0.8%) in discretionary funding for
the Child Care and Development Block Grant. Mandatory (or “entitlement”)
CCDBG funding beginning in FY2003 has been provided at the FY2002 rate ($2.717
billion for the year), under a series of funding extensions. The tenth extension (H.R.
3021) was approved by Congress and signed into law (P.L. 109-19) on July 1, 2005.
It provides funding (at the same FY2002 rate) through September 30, 2005.4
Temporary Assistance for Needy Families (TANF). TANF, created in
the 1996 welfare reform law (P.L. 104-193), provides fixed block grants for
state-designed programs of time-limited and work-conditioned aid to needy families
with children. The original legislation provided $16.5 billion annually through
FY2002, and Congress has since approved temporary extensions, the tenth of which
runs through September 30, 2005, and was signed into law as P.L. 109-19 by the
President on July 1, 2005. Child care is one of many services for which states may
use TANF funding. In FY2003, HHS reports that states spent $1.7 billion in federal
TANF funds for child care within the TANF program, and $1.77 billion in state
TANF and separate state program (SSP) MOE funds. (Of that $1.77 billion in state
spending, approximately $905 million could be “double counted” as state spending
toward the CCDF MOE requirement.) In addition, states may transfer up to 30% of
their TANF allotments to the CCDBG (CCDF), to be spent according to the rules of
that program (as opposed to TANF rules). The transfer from the FY2003 TANF
allotment to the CCDBG totaled almost $1.9 billion (representing 11% of the
FY2003 TANF allotment); however, states may choose to move previously
transferred TANF funds back to TANF, and when these amounts are taken into
account, the net amount transferred in FY2003 (as opposed to from the FY2003
TANF allotment) comes to $1.8 billion.
Child and Adult Care Food Program (CACFP). The CACFP provides
federal funds (in some cases commodities) for meals and snacks served in licensed
child care centers, family and group day care homes, and Head Start centers. Child
care providers that are exempt from state licensing requirements must comply with
alternative state or federal standards. Children under 12, migrant children under 15,
and children with disabilities of any age may participate, although most are
preschoolers. Eligible providers are usually public and private nonprofit
organizations. The CACFP is an open-ended entitlement, administered by the
4 For more information on states’ use of TANF funds, see CRS Report RL32748, The
Temporary Assistance for Needy Families (TANF) Block Grant: A Primer on Financing and
Requirements for State Programs, by Gene Falk.
CRS-4
Department of Agriculture. For FY2005, obligations are estimated to be $2.1
billion.5
Social Services Block Grant (SSBG). Title XX of the Social Security Act
authorizes Social Services Block Grants, which may be used for social services at the
states’ discretion. There are no federal income eligibility requirements, targeting
provisions, service mandates, or matching requirements. The most recently
published HHS analysis of state expenditures indicates that almost 8% of total SSBG
expenditures made in FY2002 ($205 million) were for child care in that year, similar
to those made for child care in FY2001 ($201 million). Title XX is a capped
entitlement, and state allocations are based on relative population size. It should be
noted that although the SSBG has an entitlement ceiling, appropriations may not
always abide by it. For example, the ceiling in FY2001 was $1.7 billion; however,
Congress appropriated $1.725 billion for that year, despite the ceiling. The
Consolidated Appropriations Act, 2005 (P.L. 108-447) provides $1.7 billion for the
SSBG and maintains states’ authority to transfer up to 10% of their TANF block
grants to the SSBG. (Note: the SSBG is not a discretionary program, and thus is not
affected by the across-the-board rescission.)6
Head Start. Head Start provides comprehensive early childhood education
and development services to low-income preschool children, typically (but not
always) on a part-time basis. The Head Start Act has been due to be reauthorized
since the end of FY2003, but remains an unfinished legislative agenda item. Funding
has nevertheless been provided through the appropriations process. Under current
law, Head Start funds are provided directly by HHS to local grantees, which must
comply with detailed federal performance standards. However, in its most recent
budget request (FY2006), the Administration again proposed to give up to nine states
the opportunity to administer Head Start, provided they demonstrate how Head Start
will be coordinated with other preschool programs and services to emphasize
developing skills and behaviors including language development; pre-reading skills;
numeracy; and social and emotional competence, while meeting state-established
accountability standards. This proposal proved controversial in both the House and
Senate last Congress, and was not proposed in either of the reauthorization bills
(H.R. 2123 or S. 1107) approved in the House and Senate committees of jurisdiction
this year.7
The most recent available data show funded enrollment for Head Start in
FY2004 to have totaled 905,851 children (of whom almost 62,000 were under age
three, participating in Early Head Start). The Consolidated Appropriations Act, 2005
(P.L. 108-447) provides $6.843 billion for Head Start, of which $1.4 billion becomes
available in FY2006. (The $6.843 billion amount reflects the law’s across-the-board
0.8% rescission applied to the $6.899 billion.)
5 See CRS Report RL31577, Child Nutrition and WIC Programs: Background and Funding,
by Joe Richardson.
6 See CRS Report 94-953, Social Services Block Grant (Title XX of the Social Security Act),
by Melinda Gish.
7 For more information, see CRS Report RL30952, Head Start: Background and Issues, by
Melinda Gish.
CRS-5
21st Century Community Learning Centers (21st CCLC). The 21st
Century Community Learning Centers program is administered by the Department
of Education and is authorized under the Elementary and Secondary Education Act
(ESEA), as amended in 2002 by the No Child Left Behind Act (P.L. 107-110).8
Funding for the 21st CCLC program is provided to states under a formula grant, based
on states’ shares of Title I, Part A funds. States then use their allocations to make
competitive awards to local educational agencies, community-based organizations,
or consortia of public or private agencies that primarily serve students who attend
schools with concentrations of poor students or low-performing schools. The focus
of the program is to provide after-school academic enrichment opportunities for
children in these communities. The appropriation provided by the Consolidated
Appropriations Act, 2005 (P.L. 108-447) is $991 million.
Even Start. The Department of Education administers the Even Start program,
which provides grants for family literacy projects that include early childhood
education.9 The appropriation for FY2005 is $225 million.
Individuals with Disabilities Education Act (IDEA) Programs. The
Individuals with Disabilities Education Act (IDEA) authorizes an early intervention
program for infants and toddlers with disabilities and their families, and preschool
grants for children with disabilities.10 IDEA was reauthorized during the 108th
Congress. FY2005 appropriations for the IDEA infants and toddlers program are
$441 million, and the funding level for the preschool grants program is $385 million.
Early Learning Fund/Early Learning Opportunities Act Program.
This HHS program (referred to by both names), authorized by the FY2001
Consolidated Appropriations Act (P.L. 106-554), provides grants to communities to
enhance school readiness for children under five, specifically by funding efforts to
improve the cognitive, physical, social, and emotional development of these children.
Although authorized at $600 million, FY2002 funding for the program was set at $25
million; FY2003 funding was set at $34 million (despite the President’s FY2003
budget proposal to eliminate the program) and for FY2004, P.L. 108-199 included
$34 million for the Early Learning Fund. The FY2005 appropriation is
approximately $36 million.
Early Reading First. The Early Reading First program, authorized by the
Elementary and Secondary Education Act of 1965 (as amended), supports local
efforts to enhance the school readiness of young children — particularly those from
low-income families — through scientific research-based strategies and professional
development that are designed to enhance the verbal skills, phonological awareness,
8 For more information, see CRS Report RL31240, 21st Century Community Learning
Centers in P.L. 107-110: Background and Funding, by Gail McCallion.
9 For more information, see CRS Report RL30448, Even Start Family Literacy Programs:
An Overview, by Gail McCallion.
10 For more information, see CRS Report RL31273, Individuals with Disabilities Education
Act (IDEA): Early Childhood Programs (Section 619 and Part C), by Richard Apling.
CRS-6
letter knowledge, and pre-reading skills of preschool age children.11 The program
provides competitive grants to eligible local educational agencies (LEAs) and to
public or private organizations or agencies that are located in eligible LEAs. The
Department of Education may award grants for up to six years. For FY2005, this
program is funded at $104 million.
Early Childhood Educator Professional Development. The
Department of Education provides competitive grants to partnerships to improve the
knowledge and skills of early childhood educators who work in communities that
have high concentrations of children living in poverty. For FY2005, $15 million is
appropriated for these grants.
Child Care Access Means Parents in School (CAMPIS). Authorized
under the Higher Education Act amendments of 1998, and first funded for FY1999
at $5 million, the CAMPIS program is designed to support the participation of low-
income parents in post-secondary education through campus-based child care
services. Discretionary grants of up to four years in duration are awarded
competitively to institutions of higher education, to either supplement existing child
care services, or to start a new program. Funding for FY2005, as included in the
Consolidated Appropriations Act, is $16 million.
Dependent Care Tax Credit (DCTC). The DCTC is a non-refundable tax
credit for employment-related expenses incurred for the care of a dependent child
under 13 or a disabled dependent or spouse, under Section 21 of the tax code.12
Beginning in tax year 2003, the Economic Growth and Tax Relief Reconciliation Act
of 2001 (P.L. 107-16) increased the maximum credit rate to 35% of expenses up to
$3,000 for one child (for a credit of $1,050), and up to $6,000 for two or more
children (for a credit of $2,100). The 35% rate applies to taxpayers with adjusted
gross incomes of $15,000 or less. The rate decreases by 1% for each additional
$2,000 increment (or portion thereof) in income until the rate reaches 20% for
taxpayers with incomes over $43,000. The current estimated revenue loss for 2004
is $3.1 billion, and $2.6 billion for 2005 as determined by the Joint Committee on
Taxation (JCT).
Dependent Care Assistance Program (DCAP). Under Section 129 of the
tax code, payments made by a taxpayer’s employer for dependent care assistance may
be excluded from the employee’s income and, therefore, not be subject to federal
income tax or employment taxes.13 The maximum exclusion is $5,000. Section 125
of the tax code allows employers to include dependent care assistance, along with
other fringe benefits, in nontaxable flexible benefit or “cafeteria” plans. The
estimated revenue loss associated with this income exclusion is $800 million in 2004
and $900 billion for 2005.
11 For more information, see CRS Report RL31241, Reading First and Early Reading First:
Background and Funding, by Gail McCallion.
12 For more information, see CRS Report RS21466, Dependent Care: Current Tax Benefits
and Legislative Issues, by Christine Scott.
13 Ibid.
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Table 1. Funding for Federal Child Care and Related Programs,
FY2001-FY2005
($ in millions)
Program (federal admin. agency)
2001
2002
2003
2004
2005
CCDBG -discretionary portiona (HHS)
$2,000
$2,100
$2,086i
$2,087l
$2,083m
CCDBG -entitlement portion (HHS)
2,567
2,717
2,717c 2,717c
2,717c
TANFb (HHS)
b
b
b
b
b
Child and Adult Care Food (USDA)
1,742d
1,831d
1,926d
2,013d
2,059d
Social Services Block Grantd (HHS)
1,725e
1,700e
1,700e
1,700e
1,700e
Head Start (HHS)
6,200f
6,538f
6,667g
6,775f,l
6,843f,m
21st Century Community Learning
Centers (ED)
846
1,000
994i
999l
991m
Even Start (ED)
250
250
248i
247l
225m
Idea Infants and Families (ED)
384
417
434i
444l
441m
Idea Preschool Grants (ED)
390
390
387i
388l
385m
Early Learning Fund / ELOA (HHS)
20
25
34i
34l
36m
Early Reading First (ED)
n/a
75
75i
94l
104m
Early Childhood Educator Professional
Development (ED)
10
15
15i
15l
15m
Child Care Access Means Parents in
School (ED)
25
22j
16i
16l
16m
Dependent Care Tax Credit (Treasury)
2,500h
2,500h
3,200k
3,100k
2,600k
Dependent Care Assistance Program
(Treasury)
500h
600h
800h
800h
900h
Source: Table prepared by the Congressional Research Service (CRS).
a. The CCDBG discretionary amounts shown in each column reflect the appropriated funding to be
made available for that given year, taking the advance funding into account.
b. TANF funds ($16.5 billion annually) may be used for child care, but are not specifically
appropriated as such. HHS reports that most recently states spent $1.7 billion in federal TANF
funds for child care within the TANF program in FY2003. Also, the FY2003 transfer from the
FY2003 TANF allotment to the CCDBG totaled $1.9 billion (representing 11% of the TANF
allotment). However, when transfers back to TANF (from previous years) are taken into
account, the net transfer amounts to $1.8 billion.
c. Funding for TANF and the mandatory portion of CCDBG funding for FY2003 was provided (at
the FY2002 rates) through a series of temporary extensions. For FY2004, funding was also
provided via extensions (P.L. 108-262 carried funding through Sept. 30, 2004). For FY2005,
P.L. 108-308 extended funding at this same rate through Mar. 31, 2005. P.L. 109-4 extended
funding through June 30, 2005, and P.L. 109-19 extends funding through September 30, 2005.
d. Estimated obligations, Department of Agriculture.
e. Total SSBG appropriation amount shown. In FY2002 (most recent data available), $205 million
in SSBG expenditures were for child care.
f. In each of these years, $1.4 billion was advance appropriated for the following year.
g. Of the $6.668 billion, $5.268 billion was available for FY2003, and $1.4 billion was available in
FY2004. The $5.268 billion was exempt from rescissions (or “offsets”) included in P.L. 108-7.
However, the advance appropriation of $1.4 billion for FY2004, included in P.L. 108-7 was
subject to the 0.59% rescission included in the FY2004 appropriations law (P.L. 108-199).
CRS-8
h. Estimated revenue loss, Joint Committee on Taxation.
i. Amount reflects rescission included in P.L. 108-7.
j. This amount excludes $3 million in unobligated funds transferred to the Program Administration
account to help offset a $3.7 million rescission in administrative and related expenses pursuant
to section 803 of the FY2002 Supplemental Appropriations Act.
k. Estimated revenue loss, Joint Committee on Taxation. Note: The Economic Growth and Tax
Relief Reconciliation Act of 2001 (EGTRRA) raised the limit on expenses allowed for the
credit, beginning in tax year 2003.
l. These discretionary programs were subject to an across-the-board rescission of 0.59% included in
P.L. 108-199. For the larger programs, the listed amount reflects the rescission, whereas for the
smaller programs, the use of rounding in the table masks the decrease in the actual
appropriation.
m. The omnibus appropriations law (P.L. 108-447) included an across-the-board rescission of 0.8%
for these discretionary programs. The numbers in the table reflect the offset. (For the smaller
programs, the use of rounding in the table masks the decrease in the actual appropriation.)
n/a: not applicable, program not authorized prior to FY2002.
President Bush’s FY2006 Budget Request
On February 7, 2005, President Bush released his budget request for FY2006,
which proposes to fund most, but not all, child care and related programs at the same
rounded levels provided in FY2005. Exceptions include Head Start, for which a $45
million increase is proposed, and Even Start and the Early Learning Fund, both of
which the Administration proposes to eliminate. Table 2 provides the
Administration’s proposed funding levels for child care and related programs for
FY2006 compared to the level of funding received for FY2005.
CCDBG. The President proposes to maintain both the discretionary and
mandatory portions of funding for the child care block grant (referred to in
combination as the Child Care and Development Fund (CCDF)) at the same rounded
levels14 as provided in FY2005: $2.1 billion and $2.717 billion, respectively. Level
funding is not anticipated to maintain current service levels. According to budget
documents, the number of children projected to receive child care services funded
through CCDF, TANF (transfers and direct child care spending) and the SSBG will
decrease by 300,000 over the next five years (from 2.3 million estimated in FY2004,
to 2 million in FY2010).15
SSBG and TANF. The President proposes to maintain both SSBG and TANF
at their current levels of $1.7 billion and $16.5 billion respectively. These funds may
continue to be used for child care, at states’ discretion. In addition to using funds
directly for child care, under current law, states may transfer up to 10% of their
SSBG funds to the CCDF, and up to 10% of their TANF grants to the SSBG. The
President does not propose to make changes to either of these transfer authorities.
Head Start. The FY2006 budget request includes $6.888 billion for Head
Start; an increase of $45 million above FY2005 funding. The President proposes that
the additional Head Start funding (which amounts to less than a 1% increase) be used
14 The precise level of funding for FY2005 is $2,082,921,000 and proposed for FY2006 is
$2,082,910,000 — a decrease of $11,000.
15 Analytical Perspectives, Budget of the United States, FY2006, p. 393.
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to support the Administration’s initiative to fund a nine-state pilot project, in which
those states would administer their Head Start programs, with a goal of promoting
coordination of state preschool programs, child care programs, and Head Start into
a comprehensive system of early childhood programs.16
21st Century Community Learning Centers. The President recommends
that the 21st CCLC program be funded in FY2006 at the same level as in FY2005.
Of the $991 million requested, the Administration proposes that, as in FY2005, $9.9
million be reserved for national technical assistance and evaluation activities.
IDEA Grants for Infants and Families. The Administration requests $441
million for IDEA Grants for Infants and Families for FY2006, the same as the
FY2005 appropriation level. According to the Department of Education’s FY2006
budget justifications, the program has met its process goals, such as serving over
272,000 infants and toddlers in FY2004, however, a “lack of outcome measures and
data do not support an increase in funding for this program.”
IDEA Preschool Grants. As with the grants for Infants and Families, the
President requests level funding for the IDEA preschool grants in FY2006. The
number of children served by the program are estimated by the Administration to be
706,740 in FY2005, increasing to 735,000 in FY2006. As with the IDEA grants
discussed above, the Administration contends that a lack of outcome measures and
data does not support an increase in program funding.
Even Start. For the second year in a row, the Administration is proposing to
eliminate the Even Start program, which, despite the President’s FY2005 request,
was funded at a level of $225 million in FY2005. As was the rationale last year, the
President argues that limited resources are better spent in early childhood programs
such as Reading First and Early Reading First, which, according to the
Administration “have a stronger research basis and are more likely to achieve the
President’s literacy goals for young children.” (The FY2006 budget request proposes
no increase for Early Reading First, but an increase of $195 million for Reading
First.)
Early Learning Fund. Like Even Start, the Administration favors eliminating
the Early Learning Fund (also known as the Early Learning Opportunities Program).
Congress did not adopt the President’s proposed elimination last year, and provided
$36 million in funds for FY2005. Authorization for the program expires at the end
of FY2005. The Administration proposes to fund similar activities through Early
Reading First and the Early Childhood Education Professional Development
Grant Program (ECEPDG). (ECEPDG is proposed to be maintained at $15 million
in FY2006, the same as the FY2005 appropriation.)
Child Care Access Means Parents in School (CAMPIS). The
Administration proposes to continue funding the CAMPIS program at the same level
as in FY2005, which is $16 million. According to the Department of Education,
16 For additional information about Head Start, see CRS Report RL30952 Head Start:
Background and Issues, by Melinda Gish.
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FY2006 funding is to be used by institutions to continue such services as: supporting
or establishing campus-based child care programs; establishing emergency back-up
care, summer child care, and after school services; providing subsidies and sliding
fee scales for child care costs; and establishing programs to help serve the needs of
student parents.
Table 2. Bush Administration’s FY2006 Funding Request
Compared with FY2005 Funding for Select Programs
($ in millions)
Difference
(+/-)
between
President’s
FY2006
request
President’s
and
request
FY2005
FY2005
Program
FY2006
fundinga
funding
CCDBG discretionary (HHS)
2,083
2,083
0
CCDBG mandatory (HHS)
2,717
2,717
0
SSBG (HHS)
1,700
1,700
0
Head Start (HHS)
6,888
6,843
+45
21st CCLC (ED)
991
991
0
Even Start (ED)
0
225
-225
IDEA Infants and Families (ED)
441
441
0
IDEA Preschool (ED)
385
385
0
Early Learning Fund (HHS)
0
36
-36
Early Childhood Educator Professional
Development (ED)
15
15
0
Early Reading First (ED)
104
104
0
Child Care Access Means Parents in
School (CAMPIS) (ED)
16
16
0
Source: Table prepared by the Congressional Research Service
a. The omnibus appropriations law (P.L. 108-447) included an across-the-board rescission of 0.8%.
The numbers in the table reflect that offset.
FY2006 Appropriations — In Process
On June 24, 2005, the House amended and passed H.R. 3010, a bill to make
FY2006 appropriations for the Departments of Labor, Health and Human Services,
and Education. Table 3 shows how proposed funding levels in the House-passed bill
compare to FY2005 appropriations and other proposed levels for FY2006. House-
proposed funding levels for FY2006 match the levels requested in the President’s
budget, with the exception of the Head Start and Even Start programs, which the
House proposes to fund at higher levels than proposed by the President.
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On July 14, 2005, the Senate Appropriations Committee approved and reported
its own version of H.R. 3010 (S.Rept. 109-103). Proposed funding levels mirror
those proposed in the House bill, with the following exceptions: Head Start funding
is proposed at a level $25 million less than in the House bill; Even Start would be
eliminated (as proposed by the Administration); and the IDEA Infants and Toddlers
Program would be provided with $3 million more than proposed in the House
version.
Table 3. FY2006 House-passed and Senate Committee-passed
Funding Levels Compared with FY2005 Appropriations and
President’s Request for FY2006
($ in millions)
House-
Senate
President’s
passed
Committee-
FY2005
request
H.R.
passed
Program
Fundinga
FY2006
3010
H.R. 3010
CCDBG discretionary (HHS)
$2,083
$2,083
$2,083
$2,083
SSBG (HHS)
1,700
1,700
1,700
1,700
Head Start (HHS)
6,843
6,888
6,899
6,874
21st CCLC (ED)
991
991
991
991
Even Start (ED)
225
0
200
0
IDEA Infants and Families (ED)
441
441
441
444
IDEA Preschool (ED)
385
385
385
385
Early Learning Fund (HHS)
36
0
0
0
Early Childhood Educator Professional
Development (ED)
15
15
15
15
Early Reading First (ED)
104
104
104
104
Child Care Access Means Parents in
School (CAMPIS) (ED)
16
16
16
16
Source: Table prepared by the Congressional Research Service.
a. The omnibus appropriations law (P.L. 108-447) included an across-the-board rescission of 0.8%.
The numbers in the table reflect that offset.
Administration’s Early Childhood Initiative
Good Start, Grow Smart: The Bush Administration’s Early Childhood
Initiative, was first announced by the President in April of 2002 and has been
reflected in budget proposals and program initiatives since that date. Good Start,
Grow Smart focuses on three overall areas: (1) strengthening Head Start; (2)
partnering with states to improve early childhood education; and (3) providing
information to teachers, care givers, and parents. In the President’s FY2004 budget,
he proposed to transfer the Head Start program to the Department of Education, as
well as to provide states with the option to administer the program. The Head Start
reauthorization bill passed by the House during the 108th Congress (H.R. 2210) did
not include the proposal to transfer the program to ED, but did include provisions to
allow a maximum of eight states to administer the program (provided they meet
designated requirements).
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The Administration moved ahead with two additional efforts that are in keeping
with the Good Start, Grow Smart initiative, but that did not require legislative
changes to the Head Start Act. One is the Strategic Teacher Education Program, also
known as Project STEP, described by the Head Start Bureau as “a comprehensive,
multi-faceted, sequential professional development endeavor to ensure teachers use
research-based strategies to implement early and emergent literacy.” As part of this
development, during summer and fall 2002, 3,000 Head Start staff and 100 state child
care administrators received 32 hours of training in strategies to support children’s
emerging literacy. Those who were trained are expected to serve as “mentor
coaches” for staff within their respective Head Start programs.
The second effort is the development and implementation of a national reporting
system that can be used to assess the effectiveness of Head Start programs in
achieving successful outcomes for children in terms of school readiness —
particularly the areas of literacy and number knowledge. This national reporting
system was implemented starting in the fall 2003, and assesses Head Start 4- and 5-
year-olds twice a year on educational performance measures — using indicators that
were included in legislation as part of the 1998 reauthorization of Head Start.
Legislative Activity in the 109th Congress
Child Care and Welfare Reauthorizations. Both the CCDBG and TANF
have been due to be reauthorized since the end of FY2002. Legislation to reauthorize
the programs received attention last year, but never made it out of both House and
Senate, and therefore the task of reauthorizing these programs remains on the agenda
for the 109th Congress.17 (Funding for TANF and mandatory child care is currently
being provided through a temporary extension (P.L. 109-19) that will expire
September 30, 2005.
House Action. At this point, two bills to reauthorize both CCDBG and TANF
have been introduced in the House, but only H.R. 240 has been taken up in
committee. On March 15, 2005, the Ways and Means Subcommittee on Human
Resources debated H.R. 240, and ultimately approved it (8-4), with solely Republican
support. Child care funding remains a contentious issue, and Representative Stark
offered an amendment to increase mandatory child care funding by $11 billion over
five years (as opposed to the $1 billion included in the bill), but it was rejected. It
should be noted that two committees have jurisdiction over child care: the Education
and Workforce Committee maintains jurisdiction of the CCDBG Act itself, which
includes the program rules and the authorization for discretionary funding, while the
Ways and Means Committee has responsibility for the mandatory child care funding
stream that supports CCDBG programs. The mandatory funding is included in
Section 418 of the Social Security Act, within the same title (Title IV) that includes
the TANF program. (As noted earlier, TANF funds may also be used by states to
support child care.)
17 For more information on welfare reauthorization, see CRS Issue Brief IB10140, Welfare
Reauthorization: Overview of the Issues, by Gene Falk, Melinda Gish, and Carmen
Solomon-Fears.
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H.R. 240, by Representative Pryce (Approved by Ways and Means
Subcommittee, March 15, 2005). The Personal Responsibility, Work, and
Family Promotion Act of 2005 resembles the welfare and child care reauthorization
bill passed by the House last Congress, with respect to the bill’s child care
provisions. H.R. 240 would set mandatory child care funding at $2.917 billion in
each of FY2006-FY2010 (for an increase of $1 billion over five years above current
funding). The authorized level for the discretionary portion of CCDBG funding
would be increased by $200 million annually beginning in FY2006 ($2.3 billion),
reaching $3.1 billion in FY2008.
This bill would also increase the child care quality set-aside from 4% to 6%, and
would amend state child care plan requirements to encourage states to improve the
quality of child care available to families, and to promote school readiness by
encouraging the exposure of children in care to nurturing environments and
developmentally — appropriate activities. Likewise, the bill would allow states to
establish CCDBG income eligibility limits at any level (prioritized by need),
eliminating current law’s federal limit of 85% of state median income. Lastly, the
bill would require that aggregated statistics on child care supply, demand, and quality
be included in biennial reports to Congress. (With the exception of the mandatory
funding provisions, all child care provisions fall under the jurisdiction of the
Education and Workforce Committee, which has yet to take up the bill.)
H.R. 751, by Representative McDermott (Introduced February 10,
2005). The Work, Family, and Opportunity Promotion Act includes provisions to
reauthorize TANF, and proposes to increase mandatory child care funding by $11
billion over five years.
Senate Action. Bills (S. 105 and S. 6) to reauthorize welfare and aspects of
child care were introduced early in the Congress, but these are not the bills that have
received committee action. On March 9, 2005, both the Finance Committee and the
Health, Education, Labor, and Pensions (HELP) Committee approved and ordered
reported bills (S. 667 and S. 525) to reauthorize welfare and child care respectively,
described below. Note that in the Senate, the Finance Committee has jurisdiction
over the mandatory child care funding (and TANF), and the HELP Committee holds
responsibility for the CCDBG Act.
S. 667, Personal Responsibility and Individual Development for
Everyone (PRIDE) Act of 2005 (Finance Committee Ordered Reported
March 9, 2005). The Senate Finance Committee approved and ordered reported,
with bipartisan support, a bill (S. 667) referred to as the Personal Responsibility and
Individual Development for Everyone (PRIDE) Act of 2005. The bill, which would
reauthorize TANF through FY2010, proposes to maintain the TANF block grant at
its current level and to provide an additional $6 billion in mandatory child care
funding over five years. The bill also proposes to provide an additional $1 billion
over five years to the Social Services Block Grant. The allowable transfer from
TANF to the SSBG would be maintained at 10%.
S. 525, The Caring for Children Act of 2005 (HELP Committee
Ordered Reported, March 9, 2005). This bill, introduced by Senator Alexander
on March 3, 2005, closely resembles the CCDBG reauthorization bill reported out
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of the HELP Committee last Congress (S. 880). As was the case with the earlier bill,
the HELP Committee approved S. 525 with bipartisan support.
Major provisions would: authorize CCDBG discretionary funding at a level of
$2.3 billion for FY2006, rising in $200 million increments up to $3.1 billion for
FY2010; increase the percentage of funds that must be used for quality activities
(newly specified in the proposal) from at least 4% to at least 6%; instruct states to use
not less than 70% of funds remaining after quality and administrative set-asides for
direct services (as defined by states); add three new goals to the act: (1) improving
the quality of child care, (2) promoting school preparedness through developmentally
and age-appropriate activities in child care, and (3) promoting parental and family
involvement in the education of young children in child care settings; eliminate the
federal eligibility maximum limit of 85% of state median income (SMI); require
states to describe in their state plans how they will coordinate with other early
childhood programs such as Head Start, state pre-kindergarten, and IDEA to expand
accessibility to and continuity of care; require states to conduct statistically valid
market rate surveys within two years preceding their state plans, and to set rates in
accordance with the results (without reducing the number of children served); expand
data collection requirements; and require states beginning in FY2006 to submit a plan
addressing the quality of child care services provided. Title II of the bill contains
provisions to enhance security at child care centers in federal facilities, and Title III
establishes a small business child care grant program, through which competitive
grants would be awarded to states for establishment and operation of employer-
operated child care programs. (S. 525 authorizes $50 million over five years for this
purpose, whereas S. 880 had authorized $30 million. S. 525 also proposes to change
the CCDBG allocation for tribes from “not less than 1% and not more than 2%” to
a concrete “2%.”)
S. 105, by Senator Talent (Introduced January 24, 2005). This Senate
version of the Personal Responsibility, Work, and Family Promotion Act of 2005
contains the same child care provisions as are proposed in H.R. 240 (see above).
S. 6, by Senator Santorum (Introduced January 24, 2005). Among tax
and TANF reauthorization provisions, the Family and Community Protection Act of
2005 (S. 6) includes an additional $1 billion over five years in mandatory child care
funding.
Head Start Reauthorization. The Head Start program has been due to be
reauthorized since the end of FY2003. Thus far, bills (H.R. 2123 and S. 1107) to
reauthorize the Head Start program have been introduced, amended and approved by
the respective committee with jurisdiction in both the House and Senate. Summaries
of major provisions in the two bills (H.R. 2123, as amended and unanimously
approved by the full Education and Workforce Committee in the House; and S. 1107,
as approved (by voice vote) by the full Health, Education, Labor, and Pensions
Committee in the Senate) can be found in CRS Report RL30952, Head Start:
Background and Issues.
Other Child Care-Related Legislation. Other bills related to child care
that have been introduced thus far in the 109th Congress include H.R. 335 (Lynch),
a bill to amend the CCDBG Act to increase availability and quality of child care by
CRS-15
creating incentives for people age 55 and over to become child care providers; S. 15
(Bingaman), a bill that includes several provisions to amend both the Head Start Act
and the CCDBG Act to expand access to programs and to improve program quality;
S. 32 (Dayton), a bill authorizing the Secretary of Defense to fund child care for
active duty military without access to a military child development center; and S. 233
(Roberts), a bill providing grants for building a child care training infrastructure and
for encouraging employer-provided child care.
Hearings
On March 15, 2005, the House Education and Workforce Committee’s
Subcommittee on 21st Century Competitiveness held a hearing titled “Welfare
Reform: Reauthorization of Work and Child Care.” Testimony can be found at
[http://edworkforce.house.gov/hearings/109th/21st/welfare031505/wl031505.htm].